News / Asia

    Fonterra Under Fire Over Milk Scare; Product Recalls Continue

    Fonterra logo photographed near the Fonterra Te Rapa plant near Hamilton, New Zealand, Aug. 6, 2013.
    Fonterra logo photographed near the Fonterra Te Rapa plant near Hamilton, New Zealand, Aug. 6, 2013.
    Reuters
    Fonterra — the world's largest dairy exporter — came under fire from the New Zealand government, farmers and financial regulators for its handling of a food contamination scare that has triggered product recalls and spooked parents from China to Saudi Arabia.

    The government sent officials to Fonterra premises to ensure a clearer message and to regain international confidence after New Zealand's biggest company was criticized for dragging its feet in saying it sold whey protein products that contained a bacteria that could cause botulism — a potentially fatal food poisoning.

    “We will be conducting an internal review and this will be subject to external scrutiny as well,” said Gary Romano, Fonterra's managing director of New Zealand Milk Products.

    The country's agricultural lobby urged Fonterra to be open with parents of infants about details of the contamination. “There will be a reckoning, but now is not the time; the 'who, what, why, when, where and how' questions come later,” Federated Farmers Dairy Chairman Willy Leferink said in a statement. “Right now, we owe it to our consumers here and abroad to give them facts and not speculation.”

    New Zealand's Financial Markets Authority said it was concerned about how long it took Fonterra to disclose the contamination issue. The company said it confirmed on July 31 that this was caused by a dirty pipe at one of its New Zealand plants, before issuing a media statement early on Saturday, three days later, and in an announcement to investors on Monday.

    There have been no reports of illness resulting from the affected products, but the scare risks tainting New Zealand's “clean and green” image.

    Finance Minister Bill English said the economy was likely to escape any significant damage as a result of the Fonterra scare, but there was some longer-term risk to the country's reputation.

    “The economic impact of the amount of product currently under restrictions is sufficiently small [that] it wouldn't have a discernible impact on our GDP,” English said in reply to a question in parliament.

    More recalls

    On Monday, Fonterra CEO Theo Spierings said the company did not face a ban on its products in China, only restrictions on whey protein concentrate. He said he expected the curbs would be lifted this week as soon as Fonterra provides Chinese regulators with a detailed explanation of what went wrong.

    China, Hong Kong, Sri Lanka and other countries, however, have issued fresh instant formula milk product recalls, and the New Zealand government warned that China could extend restrictions on whey protein powder to other dairy products.

    “So far, [there has been] very limited action. But this is likely to change, and it would change in the direction of wider, not narrower,” Trade Minister Tim Groser told reporters.

    Fonterra is a major supplier of bulk milk powder products used in infant formula in China, but doesn't sell in China under its own brandname after local dairy company Sanlu, in which it held a large stake, was found to have added melamine — often used in plastics — to bulk up formulas in 2008. Six babies died then and thousands were taken ill.

    China's consumer quality body said it ordered a recall of two batches of milk formula brands marketed by Abbott Laboratories, a day after some of the U.S. healthcare company's products were recalled in Vietnam. Abbot said the move was a precautionary measure after some of its milk formula brands, which did not contain whey protein concentrate sourced from Fonterra, were packaged in the Fonterra facility.

    Cow & Gate recalled 80,000 cans of one type of its stage-three baby formula in Hong Kong and Macau. It said there were no signs of contamination in any of the products sold in the two regions. More infant formula tins were cleared from New Zealand supermarkets after Nutricia, part of French food group Danone that makes the Karicare brand, announced a blanket ban Monday on two of its infant products.

    Sri Lanka suspended milk powder imports from New Zealand, while Brunei media cited its government as ordering a recall and the ban on the import, distribution and sale of Fonterra food products. Fonterra has not identified either of those countries as having been affected by the safety issue, though it has said products containing the contaminated whey protein had been sold on to Malaysia, Saudi Arabia and Thailand.

    Dairy auction

    At its fortnightly Global Dairy Trade auction, the world's biggest wholesale marketplace for milk powders and dairy products — most of which originate in New Zealand — prices fell for the first time in 6 weeks, while volumes jumped. Fonterra's GDT Price Index dropped 2.4 percent, following a 5.3 percent rise at the previous sale.

    Ahead of the auction, analysts had said the event could help gage the likely impact of the contamination scare on prices and sentiment toward New Zealand dairy products, which command a premium over rivals. In the event, the drop in prices was less than the five to 10 percent that some analysts had predicted.

    Dairy exports earn about a quarter of New Zealand's NZ$46 billion annual export earnings.

    Units in Fonterra's Shareholders Fund, which offer outside investors exposure to the cooperative's farmer shareholder dividends, closed up 1.3 percent on Tuesday at NZ$6.95, erasing most of the previous day's losses.

    “If Fonterra gets knocked as far as confidence is concerned, then the farmer gets knocked, because at the end of the day Fonterra is the farmer,” said William Stolte, a farmer in Masterton on New Zealand's North Island.

    “And the farmer has to accept that... meanwhile, we have to keep milking the cows,” he said.

    You May Like

    Video For Many US Veterans, the Vietnam War Continues

    More than 40 years after it ended, war in Vietnam and America’s role in it continue to provoke bitter debate, especially among those who fought in it

    Video Newest US Citizens, Writing the Next Great Chapter

    100 immigrants graduated Friday as US citizens in New York, joining the ranks of 680,000 others every year in cities across country

    Family's Fight Pays Off With Arlington Cemetery Burial Rights for WASPs

    Policy that allowed the Women Airforce Service Pilots veterans to receive burial rites at Arlington had been revoked in 2015

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Vietnamese-American Youth Optimistic About Obama's Visit to Vietnami
    X
    Elizabeth Lee
    May 22, 2016 6:04 AM
    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video Vietnamese-American Youth Optimistic About Obama's Visit to Vietnam

    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video First-generation, Afghan-American Student Sets Sights on Basketball Glory

    Their parents are immigrants to the United States. They are kids who live between two worlds -- their parents' homeland and the U.S. For many of them, they feel most "American" at school. It can be tricky balancing both worlds. In this report, produced by Beth Mendelson, Arash Arabasadi tells us about one Afghan-American student who seems to be coping -- one shot at a time.
    Video

    Video Newest US Citizens, Writing the Next Great Chapter

    While universities across the United States honor their newest graduates this Friday, many immigrants in downtown Manhattan are celebrating, too. One hundred of them, representing 31 countries across four continents, graduated as U.S. citizens, joining the ranks of 680,000 others every year in New York and cities around the country.
    Video

    Video Vietnam Sees Strong Economic Growth Despite Incomplete Reforms

    Vietnam has transformed its communist economy to become one of the world's fastest-growing nations. While the reforms are incomplete, multinational corporations see a profitable future in Vietnam and have made major investments -- as VOA's Jim Randle reports.
    Video

    Video Qatar Denies World Cup Corruption

    The head of Qatar’s organizing committee for the 2022 World Cup insists his country's bid to host the soccer tournament was completely clean, despite the corruption scandals that have rocked the sport’s governing body, FIFA. Hassan Al-Thawadi also said new laws would offer protection to migrants working on World Cup construction projects. VOA's Henry Ridgwell reports.
    Video

    Video Infrastructure Funding Puts Cambodia on Front Line of International Politics

    When leaders of the world’s seven most developed economies meet in Japan next week, demands for infrastructure investment world wide will be high on the agenda. Japanese Prime Minister Shinzo Abe’s push for “quality infrastructure investment” throughout Asia has been widely viewed as a counter to the rise of Chinese investment flooding into region.
    Video

    Video Democrats Fear Party Unity a Casualty in Clinton-Sanders Battle

    Democratic presidential front-runner Hillary Clinton claimed a narrow victory in Tuesday's Kentucky primary even as rival Bernie Sanders won in Oregon. Tensions between the two campaigns are rising, prompting fears that the party will have a difficult time unifying to face the presumptive Republican nominee, Donald Trump. VOA national correspondent Jim Malone has more from Washington.
    Video

    Video Portrait of a Transgender Marriage: Husband and Wife Navigate New Roles

    As controversy continues in North Carolina over the use of public bathrooms by transgender individuals, personal struggles with gender identity that were once secret are now coming to light. VOA’s Tina Trinh explored the ramifications for one couple as part of trans.formation, a series of stories on transgender issues.
    Video

    Video Amerikan Hero Flips Stereotype of Middle Eastern Character

    An Iranian American comedian is hoping to connect with American audiences through a film that inverts some of Hollywood's stereotypes about Middle Eastern characters. Sama Dizayee reports.
    Video

    Video Budding Young Inventors Tackle City's Problems with 3-D Printing

    Every city has problems, and local officials and politicians are often frustrated by their inability to solve them. But surprising solutions can come from unexpected places. Students in Baltimore. Maryland, took up the challenge to solve problems they identified in their city, and came up with projects and products to make a difference. VOA's June Soh has more on a digital fabrication competition primarily focused on 3-D design and printing. Carol Pearson narrates.

    Special Report

    Adrift The Invisible African Diaspora