Wal-Mart (NYSE:WMT), the world’s largest retailer, is facing allegations pertaining to food safety violations in China.
According to claims by Beijing Food Safety Administration, Wal-Mart sold sesame oil and squid with dangerous amounts of cancer-causing chemicals in March.
The sesame oil exceeded standard amounts of benzopyrene and squid contained hazardous levels of cadmium which are considered to be harmful for human consumption.
The company is facing another accusation by Dazhou’s animal husbandry department of selling pork ribs derived from diseased pigs in January. [1]
These two allegations have raised serious questions on the food safety measures followed by Wal-Mart.
Last year, the retailer had to deal with a pork-labeling scandal that affected its China operations adversely and damaged its reputation.
The allegation led to the arrest of two store managers, the closure of stores, and a consequent restructuring of the management team in China.
Emerging economies such as Brazil and China are very important for retailers from a strategic growth perspective. According to our estimates, international operations contribute approximately 40% to Wal-Mart’s current valuation...
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Source: Argentine Beef Packers S.A.
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