Japan Tobacco May Make More Frozen Food itself to Improve Quality Control

Source from:  03.04.08, TOKYO (Thomson Financial) 03/05/2008

Japan Tobacco Inc (JT) said Tuesday it may consider buying less of the frozen food it sells from contractors and making more of it itself as part of a broader effort to improve quality control and revive recently shaken consumer confidence in the company. But JT president Hiroshi Kimura, speaking at at press conference, did not say whether his company plans to end all contracting-out of food production in future. This follows cases of food poisoning among Japanese consumers who ate frozen dumplings that subsidiary JT Foods Co imported from China. These and other dumplings that Chinese supplier Tianyang Food made for JT Foods were found to contain pesticides. Exactly how and where the items were contaminated has yet to be established. After the food poisoning, JT and Nissin Food Products Co decided to cancel plans to merge their frozen food businesses. JT was planning to turn leading frozen foods company Katokichi Co Ltd into a wholly owned subsidiary and then sell a 49 percent stake to Nissin Food, paving the way for the three companies to consolidate their frozen food operations. After canceling the merger, JT, which currently holds 94 percent of Katokichi, said it would go ahead with its plan to increase its interest to 100 percent as soon as it is convenient. Japan's biggest cigarette maker said it would continue contracting out food production to Chinese companies for the time being. JT said it has so far recalled 447,373 packages of frozen food sold under 23 brands and that it has discovered 12 cases if contamination. The company has decided to set up a quality control center in China and to obtain obtain internationally recognized quality control certifications. JT is also planning to check pesticide usage at farms that provide ingredients and test for trace pesticides in prepared food. (1 US dollar = 103.54 yen) yasuhiko.seki@thomson.com yumiko.nishitani@thomson.com yas/yas/jm COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News. Enditem