The “cornflakes scandal” is having an impact not only on Israeli consumers, but consumers abroad as well. Although most of the cereals Telma produces are sold in Israel, the company has an active export department, supplying mainly kosher groceries in the U.S., the U.K. and France.
But in the wake of salmonella found in the company’s cornflakes, importers of the cereals are canceling their orders. On Monday, a large order that was destined for France was canceled, despite the fact that Health Ministry officials gave the Arad production line a clean bill of health after it was thoroughly checked by officials.
That declaration did little to restore customers’ faith in the products, however. According to the heads of Israel’s largest supermarkets, sales of all Telma cereals have dropped to next to nothing, while sales of other products bearing the Telma label, from soup powder to mayonnaise, were down as well. The company said Monday that it had lost NIS 2.3 million in sales in the 1- days since it was reported that boxes of cornflakes were infected with salmonella.
The scandal appeared to be having an effect on the entire cereal market. According to industry figures, cereal purchases in general were off 11 percent from weekly averages. Three weeks ago, for example, NIS 11.8 million of cereals were sold in Israel, while in the past week that number slid 13.8 percent, to NIS 10.5 million.
Meanwhile, a group of private investigators were for a second day questioning employees as part of the investigation to determine how salmonella-tainted cereal reached the market. Unilever Israel, makers of the cereal, said that an internal investigation had determined that 643 pallets of 240 packages each — a total of 154,320 boxes — had been contaminated. Each of the pallets was labeled with a special bar code that indicated that the boxes were slated to be destroyed, the company said. One of the pallets, it believes, was apparently miscoded — either accidentally or on purpose — and released for shipment.
When the scandal first surfaced, the company was insistent that none of the contaminated cereal had left the factory. After repeated grilling by the media, prompted by customers who were unable to find cornflakes on shelves, Telma’s parent company, Unilever Israel, admitted that the company had destroyed its latest shipment of cornflakes because salmonella was found in several boxes.