Kraft Singles Recall: Food Manufacturer Recalls Cheese Slices Over Plastic Choking Hazard
Key takeaways
- Kraft has issued a voluntary recall of its single American cheese slices
- The issue has caused six people to complain and affects nearly 84,000 products
- Kraft’s share price is unaffected by the news after a stroke of good luck from another source
Kraft has found itself in a dilemma with its famed single cheese slices. The product has been part of a mass recall across the U.S. after plastic pieces were found in the product and deemed a choking hazard.
But that was where the bad news ended for Kraft after it was revealed several major stakeholders had increased their shares in the food and drinks giant, which was good news for Kraft stock. Here’s the Kraft cheese singles recall lowdown and why Wall Street overlooked the noise.
What’s happened with Kraft?
Kraft, the producer of beloved food products and snacks like boxed Mac n’ Cheese, has issued a voluntary recall for nearly 84,000 of its individually wrapped Kraft Singles American processed cheese slices.
Kraft said the recall was a precautionary measure after a packaging machine malfunctioned, distributing a thin plastic film onto the product even after removing the individual wrapper and creating a potential choking hazard. In a press statement, the company confirmed a “limited number of customers” were affected by the recall.
The company also said the issue was brought to their attention after six affected customers complained about the faulty product. Kraft has advised the contaminated batches of 16 oz. Kraft Singles American Pasteurized Prepared Cheese Product will have a use-by date between January 10, 2024 and January 27, 2024.
What are customers to do if they’re affected by the recall? Either chuck the product away or exchange or refund it at the store they purchased it from.
It’s not the only company to issue a recall of late — Trader Joe’s issued a recall of its Almond Windmill Cookies, and Dark Chocolate Chunk and Almond Cookies were potentially found to have rocks in them.
What was the market reaction?
It’s hard to tell whether the recall had any impact on the share price because Kraft also had some lucky timing with a good piece of news. According to regulatory filings, First Premier Bank increased its position in Kraft by 34.7% in the second quarter, taking its stake to $601,000.
Kraft’s share price is up 2.32% since the start of the week. The stock is overall down 15.6% since the start of the year as the food and drinks giant has struggled to cope as consumers turn to cheaper own-brand products during the cost of living crisis.
The company recently announced a new CEO will be taking the position soon. Carlos Abrams-Rivera, who is currently head of the company’s North American business, will take over from current CEO Miguel Patricio on January 1.
The bottom line
The Kraft recall is an unfortunate incident, but hasn’t been a disaster for the share price. Instead, the company faces bigger issues around customers returning to its more expensive packaged foods and snacks rather than switching to cheaper products.
