Smithfield seeks to ease flu concerns

As sales of pork have dipped amid a flu scare, Smithfield Foods Inc. is trying to reassure consumers that the company's meat is safe and that its joint venture operations in Mexico were not the source of the outbreak.

C. Larry Pope, Smithfield's president and chief executive officer, said yesterday that the Virginia-based company has seen some "deterioration" in sales since the outbreak of the H1N1 virus, which has been widely called the "swine flu" and has sickened more than 1,000 people worldwide.

"That is our biggest concern today -- the economic impact of people shying away from eating our product out of fear," Pope said in a telephone interview yesterday.

Meanwhile, meat producer Tyson Foods Inc., a major employer in the Richmond area, said fears of the virus have kept some shoppers away from pork, but the Arkansas-based company expects the drop in demand to be short-lived.

And the National Pork Board, a trade group for about 70,000 U.S. pork producers, is starting a print and online advertising campaign "to reinforce the message that pork is safe to eat," spokeswoman Cindy Cunningham said.

Public health officials from the U.S. Centers for Disease Control and Prevention to the World Health Organization have said there is no danger of contracting the flu from eating properly cooked pork.

The new strain of flu, a mixture of genetic material from avian, swine and human influenza viruses, has been passed from human to human and has not been found in pigs, except for a herd in Canada that was apparently infected by a worker.

Nevertheless, "we are seeing at some of our retail customers double-digit declines in pork sales," said Pope, who has conducted two television interviews in the past week and yesterday contacted some media outlets to reiterate the company's message.

The National Pork Producers Council, the U.S. pork industry trade group, asked the federal government to buy $50 million in pork products to help bolster pricing.

The trade group said prices need to go higher and told Secretary of Agriculture Tom Vilsack in a letter yesterday that the industry losses reached $7.2 million per day between April 24 and May 1.

Smithfield has said repeatedly that public health officials in Mexico found no evidence of a link between the outbreak and the swine herds the company jointly owns in Mexico's Veracruz state.

"We still continue to see nothing that concerns us from our operations and our joint venture in Mexico," Pope said.

The company has voluntarily submitted 30 blood samples from pigs at its facility near the small town of La Gloria, Mexico, for testing by government health officials "just to be safe," Pope said. The farm is about 5 miles from the neighborhood where a 4-year-old boy is believed to have had the first case of the H1N1 virus, he said.

"We won't have those test results for 10 more days," Pope said yesterday. "But we are very confident that those test results are going to be negative."

Pope acknowledged the company has had a "community relations" problem in La Gloria, where residents have complained about the farm run by Smithfield partner Granjas Carroll de Mexico.

"We take public health very seriously," Pope said. "The biosecurity on our farms is extraordinary."

The flu scare has hurt retail sales and exports of pork as some countries such as China and Russia have restricted or even banned imports of pork from U.S. states with flu cases, Pope said.

But Pope said he believes public fears are easing now.

Smithfield shares soared 24 percent, or $2.38, to close at $12.25 yesterday on the New York Stock Exchange after concerns about the flu outbreak seemed to ease, relieving investors' fears that pork consumption would slump.

Prices for pork futures also rose, erasing declines last week when investors worried about pork consumption plunging.

Public health agencies have stopped referring to the virus as the "swine flu" and are now calling it H1N1.

The National Pork Board has been "aggressively" pushing the change in terminology, Cunningham said.

She said the impact on pork sales is unclear right now.