Orange Juice Imports Stopped (KO, PEP)

The US Food and Drug Administration has halted all imports of orange juice into the US pending final test results on imported juice from Brazil due later this week. If more than a trace amount (greater than 10 parts/billion) of a US-banned fungicide is found in the juice, it will be destroyed. The two largest orange juice producers in the US are The Coca-Cola Co. (NYSE: KO) and Pepsico Inc. (NYSE: PEP).

If the tests show just trace amounts, the juice could be allowed to be resold. The fungicide, which causes liver cancer in rats, is banned in the US but permitted in other countries. Bloomberg News reports that tests on juice already on store shelves are also being run because domestic and imported juices are often mixed.

The FDA could order the removal of tainted orange juice from the market if levels of the fungicide are determined to pose a health risk.