* Outbreak spreads to 15 states and Michigan reports more

than 12,000 cases and two deaths

* US fresh lettuce unit sales fall 9% in week ending July

18, NielsenIQ says

* Farmers market sales surge 15% to 30% as foodborne illness

concerns grow, coalition director says

By Danielle Kaye and Waylon Cunningham

NEW YORK, Aug 8 (Reuters) - Michigan health officials

cleared shoppers to put lettuce back in their grocery carts, but

anxiety about cyclosporiasis is lingering in the grocery aisles,

with some produce sellers supplied by local farms saying

customers have turned to their markets instead.

An FDA investigation has ​linked the outbreak, which has spread

to 15 states and has hit Michigan the hardest, to iceberg

lettuce sourced from Taylor Farms operations in central Mexico.

The outbreak has shaken consumer confidence in fresh produce

beyond just recalled products, hitting sales at restaurant

chains and supermarkets.

U.S. unit sales for ⁠fresh lettuce in the week ending July

18 were down 9% from a week earlier, according to market

research firm NielsenIQ. The cyclospora parasite can cause

diarrhea, nausea and ​other gastrointestinal symptoms.

So far, lettuce sales have not yet rebounded at Sunrise Market

in Au Gres, Michigan, despite the all-clear from the state, said

owner Angie Bussinger.

"I didn't even know that as a store owner, so I doubt the

customers are seeing it yet," she said, predicting at least two

more weeks of anxiety and a 1% to 2% drop in monthly produce

sales.

Bussinger, 43, said it's not just lettuce and greens:

raspberry, blueberry and strawberry sales dipped in July, too,

as shoppers latched onto online rumors that seeded fruit would

also put them at risk, amid confusion about the scope of

contamination.

For now, she's leaving the lettuce and salad aisle almost

entirely empty.

"I don't want to be Taco Bell," Bussinger said, referring to the

chain's sales dip after it was linked to the outbreak.

Foot traffic at U.S. Taco Bell stores, owned by Yum Brands ( YUM )

, was down more than 11% on Saturday, August 1, compared

to the year-earlier period, according to researcher Placer.ai.

Salad chain Sweetgreen ( SG ) on Thursday said it expected a 7%

to 8% decline in comparable sales for the year, citing the

outbreak.

DEMAND FOR DISCOUNTED GREENS

Michigan, which has reported more than 12,000 cases linked to

the outbreak, including two deaths, has seen a variety of

reactions.

Romaine and other lettuce sales stayed relatively stable at

Steve's Country Market located in Harrison, in the central part

of the state, said Tammy Hayes, the store's night manager.

"These outbreaks come and go like the weather. You become

immune to it," said Hayes, 61.

In Wisconsin, where far fewer cyclospora cases have been

reported, regional supermarket chain Woodman's Markets began

discounting Taylor Farms products at the start of the outbreak,

said Claire, a cashier who asked to only use her first name.

Roughly 30% of the carts she handles at checkout have Taylor

Farms products, from green beans to pre-made salads.

"It seems like most people are taking advantage of the sale

instead of being averse to the potential health issues," she

said.

A PREFERENCE FOR LOCAL PRODUCE

The farmers market in New York City's Union Square on

Friday, which features local vendors, was bustling in the summer

heat.

Shopper Melody Fifer said last week she only bought

vegetables she could cook, but now she was adding back some

greens. "I missed my salads," she said, holding a bag of

watercress.

Several salespeople said sales have actually improved.

"Right now, people seem to prefer locally grown food," said

Samer Saleh, running a stall for Halal Pastures.

Darlene Wolnik, program director of the Farmers Market

Coalition, a national nonprofit, said market managers have told

her sales surged 15% to 30% as concerns grew over foodborne

illnesses.

Argus Farm Stop in Ann Arbor, Michigan, whose storefronts

are supplied directly by surrounding farms, has felt the same

bump, and local farmers are racing to keep up with demand, said

Alex Blume, marketing manager.

"The lettuce is kind of flying off the shelves," he said.