Kraft Recalls 1.2M Cottage Cheese Items - Analyst Blog


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Consumers are becoming more and more conscious about the nutritional content of packaged foods. Any form of storage problem can either cause the nutritional benefit of the food to degrade or contaminate it causing serious illness. Kraft Foods Group Inc. ( KRFT ) has always played safe with its food making process and has recalled its products many times in case it had any doubt with storage issues.

Kraft Foods recently recalled 1.2 million cases of select cottage cheese products due to potential storage defects. The company doubts that some ingredients used in the products were not stored as per Kraft storage standards. This could lead to spoilage of these products and cause several food borne diseases, if consumed. The cases recalled have codes dated from May 9, 2014 through Jul 23, 2014 and have only been shipped within the United States.

The recalled cottage cheese products include brands like Knudsen Cottage Cheese, Breakstone's Cottage Cheese, SimplyKraft Cottage Cheese and DailyChef Cottage Cheese. Kraft Foods will fully refund consumers once they return the products which match the codes to their original stores of purchase. Following the recall, the Tulare, CA facility, which manufactured all these products, has ceased production.

Kraft's cottage cheese recall comes a month after it issued a recall for 96,000 pounds of Oscar Mayer Classic Wieners products. According to the U.S. Department of Agriculture's Food Safety and Inspection Service, the recall was due to wrong packaging and undeclared allergen. Earlier, in Jan 2014, Kraft recalled 1.77 million pounds of Kraft Velveeta Cheesy skilled single - macaroni and cheese products - because of incorrect labeling.

In Oct 2013, Kraft Foods voluntarily recalled some varieties of Kraft and Polly-O String Cheese and String Cheese Twists products on concerns that they could degrade before their 'Best When Used by' dates specified on the labels.

The repeated recalls are not good for Kraft's fundamentals. These recalls have a negative impact on the company's reputation.

The Zacks Rank #4 (Sell) company has been struggling with its top line ever since the split from Mondelez International Inc. ( MDLZ ) due to broader macro pressures. Other food companies that have been struggling with the top line for the past few quarters are Kellogg Company ( K ) and General Mills, Inc. ( GIS ). Both these companies' sales have been hurt by their choppy cereal business.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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