Nippon Meat to brief press

- Last updated on GMT

Related tags: Food, Beef, Food processing

Japan's Nippon Meat Packers, battered by a beef mislabelling
scandal, will give results of an investigation today at a news
conference in which its founder is expected to resign as chairman.

Japan's Nippon Meat Packers, battered by a beef mislabelling scandal, will give results of an investigation today at a news conference in which its founder is expected to resign as chairman.

The company, Japan's biggest sausage maker, faced a fierce consumer backlash after the scandal came to light earlier this month. Leading supermarkets pulled its products from their shelves, and its share price has fallen around 35 per cent.

It is the latest in a series of scandals that have cast a shadow over Japan's food industry.

Media reports said Nippon Meat is expected to announce at a press briefing that Yoshinori Ohkoso, 87, will step down as chairman to take responsibility, while his son Hiroji will remain president but take a pay cut.

Analysts had said the chairman's resignation would be a crucial first step towards rebuilding its tattered brand name.

Nippon Meat had admitted that its subsidiary Nippon Food Kansai passed off imported beef as domestic to get money from a government buyback scheme amid poor sales after an outbreak of mad cow disease in Japan last September.

The scam sent Nippon Meat's shares plunging before a slight recovery in recent sessions, and led major retailers such as Ito-Yokado, Seiyu and Aeon to yank its products from their shelves, pummelling sales.

Nippon Meat said last week its sales of ham, sausage and processed food products would probably fall by around 40 percent in August from a year ago, and ratings agency Moody's Investors Service has downgraded the firm's long-term debt ratings.

The Nippon Meat scam came to light after a similar scandal earlier this year in which Snow Brand Food, Japan's sixth-largest meat packer before it was liquidated, had mislabelled imported beef.

Nippon Meat Vice President Heihachiro Azuma and Senior Managing Director Motoaki Shoji, who are believed to have known that Nippon Food tried to pass imported beef off as domestic beef, are also expected to step down.

Nippon Meat will likely announce measures to prevent future misdeeds, including the establishment of a system to prevent falsification of financial data and a section that will accept reports from staff about misconduct by other workers.

The firm is likely to receive permission from the Agriculture Ministry to resume beef sales by the end of this month, the Nihon Keizai Shimbun newspaper said.

The ministry had urged Nippon Meat last Wednesday to stop supplying beef to Nippon Food until the two firms had drawn up measures to prevent similar scandals.

The Agriculture Ministry decided that a prolonged stoppage of sales by the Nippon Meat group would adversely affect the domestic beef distribution market, the newspaper said.

Nippon Meat generates about 64 per cent of group revenues from meat and other products, while processed foods account for around 21 per cent and ham and sausages around 15 per cent.

Related topics: Processing & Packaging

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