BEIJING, Oct 28 (Reuters) - China, trying to convince the world its food is safe, has now been hit by fruit fly rumours which have cost farmers millions of dollars in lost sales.

Tangerines, usually wildly popular at this time of year, are selling for less than 1 yuan (about 15 U.S. cents) a kg in Beijing and shoppers are still reluctant to buy while 1.6 million tonnes of unwanted fruit sit waiting for delivery trucks in the central province of Hubei.

"The scare has caused direct economic losses of 400 million yuan ($57 million) so far and the figure is expected to rise if the crisis does not end in a week," the China Daily quoted Chen Zhiqiang, a press official in Changde, a major producing area in southern Hunan province, as saying.

Li Chuanyou, secretary-general of the fruit industry association in Hubei, said about 70 percent of the harvest had not been sold.

"If the situation persists, Hubei farmers may suffer a loss of up to 1.5 billion yuan," he said.

The panic was caused by rumours in the southwestern province of Sichuan last week that 10,000 tonnes of tangerines had to be destroyed because of fruit flies.

Sichuan denied the reports, saying only 12 tonnes were destroyed and that the situation was under control.

"I know the tangerines sold in Beijing have not been infected, but I still feel a bit uneasy," the China Daily quoted a shopper as saying.

China is at pains to convince the world its food is safe after a series of health scares, the most recent involving tainted milk. (Reporting by Beijing Newsroom; Editing by Nick Macfie) ($1=6.843 Yuan) ($1=6.843 Yuan)

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