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ConAgra recalls 19M pounds of beef
Department of Agriculture says beef processed at a Colorado plant may contain E. coli.
July 19, 2002: 4:42 PM EDT

NEW YORK (CNN/Money) - ConAgra, the food company, is voluntarily recalling nearly 19 million pounds of beef that may be contaminated with E. coli, the federal government said Friday.

It's the second-biggest beef recall on record.

The move expands a June 30 voluntary recall of 354,200 pounds of fresh and frozen ground beef products from the Omaha, Neb.-based company.

Shares of ConAgra (CAG: down $1.81 to $21.94, Research, Estimates) tumbled 7 percent Friday amid a falling U.S. stock market. But the news brought no panic at the Chicago Mercantile Exchange, where live cattle futures were down just slightly.

The Centers for Disease Control said 16 Colorado residents were sickened by ConAgra beef related to the initial recall. Six more people sickened in California, Michigan, South Dakota, Washington and Wyoming may also have eaten the beef.

The Department of Agriculture said the recall of 18.6 million pounds of beef follows a review of plant practices and company records that indicated beef produced at a Greeley, Colo., plant had a heightened chance of containing E. coli, a potentially deadly bacterium that can cause bloody diarrhea and dehydration.

It was the biggest recall since Hudson Foods offered to buy back 25 million pounds of beef in 1997, the department said.

ConAgra could not immediately be reached for comment. But G. Leonard Teitelbaum, who covers the company for Merrill Lynch, said the recall is unlikely to cost ConAgra much money because most of the beef, produced prior to the July 4 weekend, has already been consumed.

"History indicates that less than 10 percent of the meat recalled over a time period such as this is actually returned," Teitelbaum told clients.

While Teitelbaum expects little to no hit to ConAgra's profits, he said he's concerned about "what this recall will do to the integrity of the impending sale of the meat business to JV Swift & Co."

He expects the sale to bring ConAgra $800 million when it closes Aug. 30.

The Department of Agriculture said that consumers who have purchased the suspect beef are encouraged not to consume it and return it to the place of purchase. Still, the department added that cooking at temperatures above 160 degrees will kill the bacterium.

Click here for more details from the Department of Agriculture.

The labels on all products subject to the recall bear the code "EST. 969" inside the USDA seal of inspection. They were produced between April 12 and June 29.  Top of page

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