Fonterra milk scare claims first scalp

THE Fonterra contamination scare has claimed its first scalp with Gary Romano, Managing Director NZ Milk Products, resigning with immediate effect.

Chief executive Theo Spierings said he had accepted Mr Romano's resignation.

"Gary has made a significant contribution during his time at Fonterra and we respect his decision,'' Mr Spierings said.

Mr Spierings will assume interim responsibility for the day-to-day operations of NZ Milk Products.

Mr Romano fronted up for Fonterra to New Zealand media while Mr Spierings went to China immediately following the scare.

Mr Romano's focus was to "drive profitability through a customer-centric approach to business that delivers world-class standards in productivity, quality, safety and service,'' Fonterra said on its website

The contamination was confined to 38 metric tonnes of whey protein concentrate (WPC80) manufactured at Fonterra's Hautapu plant near Cambridge and first picked up at a plant in Australia. It was used in the manufacture of infant formula, juice and dairy beverages, yoghurt, body building powder, and animal stock food.

The threat to New Zealand's reputation with Chinese consumers has put the Government into overdrive to head off the risk, and it's fast-tracking legislation to allow a speedy inquiry so Prime Minister John Key can front up in China to allay those concerns.

The government investigation is one of four, with Fonterra holding two probes and the Ministry for Primary Industries also holding an inquiry.

Units in the Fonterra Shareholders' Fund, which gives outside investors access to the dairy company's dividend stream, fell 0.4 percent to $6.90.


In this situation I would have made sure officials were on the ground, sorting this out. I would demand to know the status of any ban within 24 hours. Then I would travel to those countries and sort out the issues.

Meanwhile, Russian media reports say the Russian, Kazakhstan and Belarus ban on Fonterra dairy imports due to the botulism scare may not be lifted until next year.

The news stories also suggest the bans were cemented after New Zealand Embassy officials last week failed to assure Russian officials of the safety of Fonterra products a week ago.

The bans by the three former Soviet republics which work together on trade issues were confirmed yesterday after initial conflicting reports about Russia's block days earlier.

Russian news agency Interfax quoted Federal Veterinary and Phyto-Sanitary Oversight Service head Sergei Dankvert as saying the ban would continue until the regulator had received relevant information from New Zealand authorities and decided on inspections of New Zealand suppliers.

However, "inspection lists are closed," for this year, Mr Dankvert said.

"So now only next year", he added.

Another report on the Rossiyskaya Gazeta website quoted Federal Service for Consumer Rights Protection (Rospotrebnadzor) as saying the ban, imposed on August 3 was "justified" and Russian officials consultations with New Zealand Embassy officials in Moscow on August 7 "further proved the correctness of this decision".

"No exhaustive answers were given during the consultations to the questions previously posed by Rospotrebnadzor, or to those posed in the course of the meeting," the regulators said in a statement.

Labour's trade spokesman Clayton Cosgrove said the Russian reports suggested the Government and Trade Minister Tim Groser's response was inadequate.

"A Trade Minister must act quickly and effectively on all issues that affect our export markets", he said.

"In this situation I would have made sure officials were on the ground, sorting this out. I would demand to know the status of any ban within 24 hours. Then I would travel to those countries and sort out the issues."

Mr Groser and Primary Industries Nathan Guy said officials were working closely with Russian authorities to provide the reassurance they needed over New Zealand dairy products.

"MPI and MFAT, along with the New Zealand Embassy in Moscow, are working to reopen the market, including by meeting with key food safety and health officials in Moscow", Mr Guy said.

He said no potentially contaminated product had been exported to Russia, Kazakhstan or Belarus from New Zealand, "however Russia has taken a precautionary approach, and we are now working to reassure the appropriate agencies of all the steps being taken by MPI and MFAT on this matter".

After yesterday saying dairy trade to Russia last year was $213 million, officials today said the figure was $106 million, while trade with Kazakhstand was $310,600. Trade with Belarus was virtually nil.