The decision of the Government and Fonterra to keep the DCD residues discovery a secret between them for months and not inform other dairy exporters is to get a formal industry shakedown this month.
Members of the Dairy Companies Association of New Zealand (DCANZ), whose chairman is Fonterra director Malcolm Bailey, are to meet Ministry for Primary Industries (MPI) bosses on April 26.
Laurie Margrain, chairman of the country’s No 2 dairy exporter, Open Country Dairy, said the company would be looking for answers, and protocols, to ensure no repeat of the January fiasco.
Independent processors, along with the public, were not told about the chemical residue discovery in Fonterra testing of some of its dairy products until four months later, when it was announced in late January by MPI.
Some companies in the $14.5 billion dairy export sector buy milk from Fonterra. They were caught unawares by the announcement and had no time to test their own products for DCD before they were shipped to overseas customers.
MPI documents obtained by the Waikato Times under the Official Information Act confirm that MPI decided in November not to discuss Fonterra’s September discovery with anyone else.
The documents also show DCD residue was found at very low levels in a wider range of dairy products than milk powder, as first announced. Further testing found in it milk protein concentrate, colostrum, nutritional powders and UHT milk.
DCD, or dicyandiamide, is chemically related to melamine, said MPI.
Used uniquely in New Zealand agriculture, mainly dairying, on pasture as a nitrogen inhibitor, it did not pose food safety risks, MPI said.
It is no longer sold by fertiliser companies Ballance and Ravensdown.
It was applied by farmers twice a year, mainly in Canterbury. MPI estimated about 15 per cent of Canterbury farmers may have used DCD last year.
MPI’s bombshell announcement in late January caused alarm in overseas dairy markets, particularly China, which had a fatal melamine infant formula poisoning scandal in 2008.
The severe reaction prompted Fonterra’s chief executive to escalate the DCD issue to «a crisis», but the documents show Fonterra had been very worried about international trade reaction for months, and that MPI had a public relations strategy to manage the DCD issue since last year. This included having a «holding» PR plan for over Christmas should the DCD discovery get out.
In an MPI meeting minute dated November 7 there is a caution that «MPI need to be careful of the time frame between being made aware of the issue and communicating this to the public, while also considering the effect on trade».
The documents do little to clear up a mystery of how involved DCANZ was before the public announcement in January.
MPI said DCANZ was «part of a working group» on DCD. But non-Fonterra DCANZ members said they did not know about the DCD issue much before the public.
An MPI document dated December 20 entitled «DCD working group: Actions and decisions» showed a DCANZ representative was there «in Simon Tucker’s stead». The name of the representative was blanked out. Tucker has since taken up a diplomatic post overseas. Industry organisation DairyNZ, which does DCANZ’s administration, said it could not say who the person was and DCANZ chairman Bailey could not be contacted.
The OIA documents said it was very likely that large overseas manufacturers and some regulators would start testing for the DCD in milk because the compound can be used to falsely raise protein levels. Last year the United States Food and Drug Administration published a methodology for testing for DCD.
The papers said as there was no accepted maximum residue level internationally for DCD in food products, its presence in milk, even at very low and harmless levels, could raise trade and perception risks.
Source: Stuff