Japan food recall revives StarLink biotech scare By Jae Hur TOKYO, May 25 (Reuters) - A nationwide recall of potato snacks by a Japanese food maker has rekindled concerns over unapproved gene-spliced StarLink corn, prompting importers once again to shun U.S. grain, traders said on Friday. The Health Ministry on Thursday ordered Osaka-based House Foods Corp to recall some of its snack products, called O'ZACK, after the ministry found traces of unapproved genetically modified (GM) NewLeaf Plus potato in the products. The recall is Japan's first after the imposition of stricter rules for imports of biotech products in April, when the ministry introduced checks for unapproved GM crops in food imports at unloading ports and in food products on the domestic market. The new rules established zero tolerance for imports containing unapproved gene-altered products and required mandatory labelling for approved GM products. NewLeaf Plus, developed by leading U.S. agricultural biotech firm Monsanto Co (NYSE:MON - news) to protect potatoes from insects and the potato leafroll virus, has not been approved in Japan. In 1998, Monsanto's Japan unit applied for approval of NewLeaf Plus in Japan. ``It's a shock,'' a trader with a major trading house said. ``We'd thought about the possibility of a food recall following the new rules against GM crops, but now it has happened for real.'' The recall, reminiscent of the StarLink furore late last year, has again hit Japanese appetite for U.S. corn, which had been picking up as the controversy died down, another trader said. POPULAR SNACKS Japan imports four million tonnes of corn for food use each year and another 12 million tonnes for feed use. The discovery of StarLink in food products last October by a consumer group had prompted Japan, where StarLink is not approved even for animal feed, to cut its U.S. corn buying. It also drove importers to find alternative supply sources. StarLink, developed by Franco-German biotech firm Aventis SA to fight a destructive pest known as the European corn borer, has not been approved by U.S. regulators for human consumption because of concerns over potential allergic reactions. On Friday, House Foods said it had halted production and sales of the snack products until it could secure raw ingredients that were confirmed as safe. The company decided to delay the launch of new O'ZACK products that had been set for June. ``We started removing two O'ZACK items following the government order and one Cheddar cheese item voluntarily from domestic store selves,'' a spokesman said. The recall will cost the company about 300 million yen ($2.5 million), he said. Sales turnover for O'ZACK snacks was about three billion yen in the year to last March, against total sales of 180 billion yen. The products are House Foods' second-biggest earner among its snack range, he said. House Foods imported ingredients for O'ZACK snacks from three suppliers in the United States and one in Canada with certificates that showed non-GM products, he said. House Foods shares closed up 0.36 percent at 1,385 yen after falling 50 yen to 1,330 earlier.