5 Aug 2013

Fonterra knows it has to explain delay

5:18 pm on 5 August 2013

Fonterra says it knows it has to answer why it delayed releasing information about a contamination scare to the Government.

Some of the company's whey protein used in infant formula and other products is contaminated and may cause the paralytic illness botulism.

Two products of the Karicare formula brand have been recalled, as has some calf-milk replacer made by Fonterra's animal feed subsidiary, NZAgbiz.

The contamination happened in May last year, but MPI acting director-general Scott Gallagher was not told until Friday.

Thirty eight tonnes of contaminated whey was produced in May 2012, by a dirty pipe at one of Fonterra's processing plants in Waikato.

Testing in March indicated a problem and the whey tested positive for clostridium botulinum on Wednesday. Fonterra notified MPI on Friday afternoon.

The batches of whey product were used in 870 tonnes of products.

Fonterra is facing rising criticism over its delay in releasing information.

The Infant Formula Exporters Association is scathing.

Chief administrative officer Chris Claridge says exporters are deeply worried about the way the contamination alert has been handled and he doesn't think it's going to be sorted out quickly.

"Our members are deeply concerned about the lack of integrated, cohesive and coherent communication from New Zealand to the rest of the world.

"Consumers should have been told straight away what product and what brands are impacted. The industry should have been told straight away so as we could report back to our distribution networks worldwide 'this is what's happening, this is the result and this is how we are going to manage it.' "

"There is an absence of leadership in the management of how we as a country represent ourselves to the rest of the world when it comes to food safety."

Economic Development Minister Steven Joyce said on Sunday he has warned the company about its handling of the issue.

Prime Minister John Key told Morning Report that Fonterra will eventually have to explain why it took so long to raise the issue, when it first identified a possible problem during testing in May 2012.

Mr Key said he would have expected a company whose success relies on consumer confidence would not have taken that risk.

He said there is a real risk that overseas consumers will lose trust in Fonterra.

Mr Key said the Ministry for Primary Industries has more than 60 people working around the clock on the issue.

Gary Romano, Fonterra's head of New Zealand milk products, said he knows there are timeline questions and the company will give clarity on that at a later date.

Mr Romano says the company is focused for now on public safety, tracking products, and recalling them as appropriate.

Fonterra chief executive Theo Spierings is now in China.