Japan's Snow Brand hit by new tainted milk finding

TOKYO (Reuters) -- Shares in Japan's Snow Brand Milk Products Co Ltd slid on Monday, hit by news that toxic-producing bacteria had been found in a milk product made by its plant in northern Japan.

Snow Brand said the tainted skimmed milk had been shipped to its Osaka plant in western Japan on June 20, shortly before an outbreak of food-poisoning there that left more than 14,000 people ill after drinking its milk.

RESOURCE Food Poisoning     MESSAGE BOARD Food safety

Jiji news agency said the skimmed milk from the Taiki plant in northern Hokkaido island had been used in milk products believed to have caused the poisoning.

The latest blow to confidence in the country's largest milk producer sent its shares down 4.63 percent to 433 yen in morning trade.

In July, its shares hit a low of 382 yen in the wake of the poisoning scandal, 38.2 percent down from a year high of 619 yen on June 21 before gradually recovering to 473 yen by August 10.

Snow Brand said last Friday that Osaka city authorities had detected toxin produced by a bacteria -- staphylococcus aureus-- in preserved samples of powdered skimmed milk produced at the Taiki plant on April 10 and shipped to its Osaka plant on June 20.

The Taiki plant, which produces cheese and powdered milk, halted production from August 19 as a result of the finding, a Snow Brand spokeswoman said on Monday. She declined to comment on media reports that health authorities in Hokkaido had inspected the plant twice over the weekend.

The spokeswoman added there were no plans to halt production at the firm's seven other powdered-milk plants because bacteria had only been discovered at the Hokkaido plant.

Last Wednesday, Snow Brand said it posted a parent net loss of 11.2 billion yen ($103.5 million) for the April-July period due to the scandal, which forced it to close its 21 milk-producing plants for hygiene inspection by third-party organizations from July 12.

Earlier this month, it resumed output at 20 plants after Health Ministry inspections found them to be safe. The exception was its Osaka plant, which has remained closed.

The scandal led to the resignation of Snow Brand's president and seven other top executives.

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