FDA halts orange juice shipments to test for fungicide

NEW YORK (CNNMoney) -- The U.S. Food and Drug Administration says it has halted shipments of imported orange juice from all over the world and will test each one for traces of fungicide.

The decision to test orange juice and orange juice concentrate shipments, which was announced Tuesday, came after an unnamed juice company alerted the FDA last month that it found low levels of the fungicide, carbendazim, in products imported from Brazil.

The FDA said it will examine all container shipments of orange juice that arrive at U.S. ports. The agency will sample contents from multiple parts of each shipment; the subsequent testing could take between five and ten business days.

Shipments that test negative for "detectable levels" of carbendazim will be allowed to enter the country.

But "orange juice that shows a level of carbendazim equal to or higher than 10 parts per billion, a baseline FDA level of quantification, will be denied entry into the U.S.," according to the Juice Products Association, the trade organization that represents the fruit and juice products industry including giants like Coca-Cola (KO, Fortune 500), owner of Minute Maid, and PepsiCo (PEP, Fortune 500), owner of Tropicana.

The FDA said that if three of a company's shipments test negative for carbendazim, that company's shipments will no longer have to go through mandatory testing. It "remains to be seen" exactly how many companies will be involved in the tests, the FDA said.

Orange juice futures spike on fungicide fears

Shipments that test positive for the fungicide, which is legal in Brazil and other parts of the world but considered an "unlawful pesticide chemical residue" under U.S. law, will be "turned away or destroyed," said the FDA.

About 25% of all orange juice consumed in the United States is imported, while the rest is supplied domestically, according to the U.S. Department of Agriculture. Only 11% of all orange juice consumed in the United States is imported from Brazil, the agency said.

The levels of carbendazim that sparked the testing were "very low," the FDA said, and the Environmental Protection Agency said those levels do not raise safety concerns, according to a preliminary risk assessment.

However, the EPA is continuing to conduct risk assessments, and said it will have more results next week.

At that level, the fungicide does not raise safety concerns, according to a preliminary risk assessment from the EPA.

The FDA insists that "consumers can be confident that the orange juice in their refrigerators is safe."

Orange juice futures jumped almost 10% Tuesday amid fears that the U.S. government could ban Brazilian orange juice, but retreated in trading on Wednesday.

--CNNMoney's Ben Rooney and Parija Kavilanz contributed to this article.