BLAKELY, Georgia (Reuters) - Residents of the self-proclaimed peanut capital of the world fear long-term fallout from a U.S. salmonella outbreak linked to a factory in their small town in southwestern Georgia.
Officials in Blakely hope for the best and stress that the three bigger peanut factories in town are not affected. But the health scare is not a welcome event as the U.S. recession worsens and Georgia's peanut farmers get ready to plant.
On Friday, the U.S. Food and Drug Administration said it was joining the Justice Department in a criminal probe of the Peanut Corporation of America's factory in Blakely as a result of an outbreak linked to the plant that has sickened 500 people in the United States and Canada and may have killed eight.
The company said it would expand its recall to all peanut products made at the plant in Blakely since January 1, 2007, after government inspectors found more strains of salmonella there.
It has laid off 46 workers, worsening the strain on the town of 5,700 near Georgia's border with Alabama.
"My prayer is that this community will come out of this stronger and people will understand that, while one small manufacturing plant had a process, it's not a negative on the community," said Mayor Ric Hall.
"This community is not going to suffer other than the poor folks who don't have a paycheck coming in."
The smell of roasting peanuts from nearby plants wafts over the PCA factory on the outskirts of Blakely but almost all of its workers have been laid off.
"I am angry at the system because I am one who has always paid my taxes and tried to pay my bills and never asked for help and now that I need help I can't get it," said Manuel Brubaker, 63, who was a purchasing agent at the plant.
"It's not just me. There's all the people that work with me and tomorrow is going to be the last day for ... (employees) at the paper mill. The economy is bad right now. Times are hard."
The shutdown of a big machine at the Georgia-Pacific paper mill in the town has resulted in more than 100 layoffs.
The health scare could affect Georgia's entire peanut economy, lowering prices and reducing consumption by up to 20 percent in the weeks before planting season, said Brian Cresswell, the University of Georgia's county extension director.
"It's going to hit it pretty hard," he said. "Peanuts at this point are not even moving through the pipeline and they are already talking about $355 a ton. That's a bare minimum. Last season it was up to 500 a ton."
Early County also relies on cotton but a statue of a peanut in Blakely's main square shows which commodity is king.
Like many towns in the rural south, Blakely was facing a long economic problem even before the recession hit and the peanut scare put it in the headlines.
Mechanization has cut the number of agricultural jobs, with the brightest young people leaving for college and frequently not returning, civic leaders said.
At the same time, low visibility and the distance from cities like Tallahassee, Columbus and Atlanta make it hard to attract investment, said Hilary Halford, president of the county's chamber of commerce.
Civic leaders hope a planned coal power plant clears legal and environmental hurdles. They say completion of a four-lane highway running by the town will improve transportation.
They have also set up an Early County 2055 project to promote long-term planning. While they acknowledge the peanut scare has come at a bad time, they hope it is a temporary setback.
"This is a great place to do business but people don't know about us," Halford said. "We are trying to get our name out there and now our name is out there and it is negative."
Editing by Tom Brown and John O'Callaghan