A freight Capt can refuse a specific shipment (i.e. "I'm not going to take THAT particular pallet") because it's improperly packed or otherwise poses a safety risk. He can't refuse to take an entire type of otherwise allowed cargo, any more than a pax Capt could say "I'm not going to take any Muslims". The FAA probably won't take certificate action against him, but his employer is likely to determine that his particular squeamishness doesn't mesh well with their business model.