Rural round-up

April 25, 2014

Food Safety Assurance Advisory Council established:

Food Safety Minister Nikki Kaye said today a Food Safety and Assurance Advisory Council is being set up to provide independent advice to the government on issues relating to food safety.

Establishing this council is one of the 29 recommendations of the Government Inquiry into the Whey Protein Concentrate Contamination Incident, released in December last year.

“At the moment there is no independent group that looks at the whole of New Zealand’s food safety and assurance system and is able to provide high-level independent advice and risk analysis,” Ms Kaye says.

“This council is being set up to do this and will report to the Director-General of the Ministry for Primary Industries (MPI). It will provide a valuable sounding board for new ideas and contribute to raising consumer and market confidence in New Zealand’s food. . .

Memorandum to restore Waiapu catchment signed:

Primary Industries Minister Nathan Guy and Associate Minister Jo Goodhew today announced a collaborative partnership to restore the Waiapu catchment in the Gisborne District.

“The signing of a Memorandum of Understanding between MPI, Te Runanganui O Ngāti Porou and Gisborne District Council demonstrates a long term commitment to work together and with landowners to address the erosion control problems in the catchment.

“The Waiapu River has the highest suspended sediment yield of any river in New Zealand and one of the highest in the world. If nothing is done, erosion and sedimentation could double by 2050.

“This is a great example of this Government working together with iwi and local councils to invest in and develop our regions. This long-term partnership will create significant environmental, cultural, social and economic benefits for iwi and the local community,” says Mr Guy. . .

Otago landowners help control TB through levy:

Consultation with Otago landowners over the levy for the region’s bovine tuberculosis (TB) control programme has gathered positive responses.

TBfree Otago Committee Chairman Ross Beckingsale said through the levy and a grant from the Otago Regional Council, landowners will fund around 10 per cent of the $7.5 million TB control programme to be implemented in the region.

The remainder comes from the farming sector and central government.

The 2014/2015 programme will consist of about one million hectares of pest control, mainly ground-based possum trapping, and a single aerial operation in difficult terrain. There will also be work assessing the possum populations and surveillance of pests to detect if TB is present in wild animal populations. . .

Earnscleugh Orchard Supreme Winner of Otago Ballance Farm Environment Awards:

An industry leading Central Otago orchard with a long term sustainability focus has won the Supreme title in the 2014 Otago Ballance Farm Environment Awards.

Wayne McIntosh, manager of Earnscleugh-based McIntosh Orchard Ltd, received the Supreme award at a special Ballance Farm Environment Awards (BFEA) ceremony on April 11. He also collected the Hill Laboratories Harvest Award, the Ballance Agri-Nutrients Soil Management Award, the Massey University Innovation Award and the WaterForce Integrated Management Award.

BFEA judges said the 64ha pip and stonefruit operation is a business at the forefront of its industry, describing it as a top producing orchard with “a vision and strategy to promote the Otago region and to be recognised nationally and internationally”. . .

How to lose an argument on food and agriculture topics – Agriculture Proud:

A few weeks back, I shared several lessons learned while sticking my neck out and engaging in discussions centered around food and agriculture topics. Today, I share a few lessons learned by failure; sometimes my own.

  1. Assuming science will give us all the answers; it only gives us some of the answers. Pick a topic, any topic. Chances are you can find “scientists” on either side of the issue. Many people in the general public do not trust science or believe it can be bought-off. Often times, questions may be more about the ethics than the science.
  2. Using economics as the justification for all of our practices. If you own a business or depend on something for your livelihood, chances are who know what makes sound economic sense. “Of course we treat our cows well or they wouldn’t produce for us,” probably doesn’t convey the right message to a non-farm consumer. Making more money and welfare of animals/environment doesn’t always go hand in hand.
  3. Assuming that you have to speak up in defense of all agricultural practices. Chances are you don’t have experience in all areas, you’ll get backed into a corner and lose all credibility. Also, not all practices are defensible. (Read more) Wait, why are we waiting to play defense? . . .

Resistance better than resilience – Jamie-Lee Oldfield:

DRY conditions have meant lower than usual worm egg counts in sheep throughout summer, but recent rainfall and warm temperatures could see a rapid rate of infection.

However, those producers focusing on resistance, rather than resilience, may be better off this season.

Veterinary Health Research lab manager Rad Nielsen said while the worm season will potentially be less severe than normal because of the drought, he has seen high counts in recent weeks, and producers should be cautious not to “get caught out”. . .

  “Agriculture, science …. And stuff like that”… A New Blog – Pasture to Profit:

“Agriculture,science and stuff like that” is a new blog created by AgResearch scientist Jill Walcroft as part of an action research project investigating the ins and outs of science communication with social media.

Worth exploring and discussing, especially science to do with land. I feel that sometimes science is not very accessible. So I’ve given myself a challenge, “can I present the stories in such a way that people’s eyes don’t glaze over after the first sentence”. I am also keen to understand the reasons scientists may or may not see social media as a good avenue for communicating their scientific findings, and to hopefully find ways of enabling scientists to uptake up these technologies with some confidence.

Summer shade for cool cows - Agriculture, science . . . and stuff like that:

A study investigating the impacts of shade on the wellbeing of cattle came up with some ‘cool’ stuff, really cool for the cattle that is.

AgResearch scientist, Keith Betteridge, started his science career at the Kaikohe Regional Station of DSIR Grasslands. When he arrived in the far north, he couldn’t understand why the land had not been cleared of trees and scrub. Conversely, when he returned to the Manawatu 12 years later, he could not understand why so many farmers had cut down nearly every tree on their farm. That shift in his perception about what makes an attractive and healthy landscape has sunk in deep and made the study he carried out recently seem very logical.

At a recent beef farmer discussion group an argument was put forward, that if cattle are under shade then they aren’t eating and therefore might be slower to fatten and this might lead to a loss of income. Since there was little science data to support or dispel this argument, AgResearch was asked to undertake a short experiment to provide some hard facts. . .


Fonterra fined $300,000

April 5, 2014

Fonterra has been fined $300,000 for it failings in last year’s food safety scare.

Fonterra Cooperative Group, the country’s biggest company, was fined $300,000 for breaches of the Animal Products Act during last year’s whey protein concentrate incident.

Judge Peter Hobbs fined Fonterra $60,000 for three separate charges and $120,000 for a fourth charge in the Wellington District Court. The judge took a starting point of $375,000, before mitigating factors including Fonterra’s early guilty plea and steps it took to address the issue, though he lifted the penalty to reflect the company’s size.

“There’s no doubt the flawed reworking process and its fall-out had wide ramifications,” Judge Hobbs said. “I accept, however, the offending resulted from careless failure to follow proper procedure rather than a deliberate or reckless plan – things could have and should have been done better.” . . .

Every company which deals in food faces the risk of a safety problem. All should have better systems in palce to deal with it than Fonterra had.

It let its customers and suppliers down and it is the latter who will ultimately pay:

After accepting four Ministry for Primary Industries (MPI) charges relating to the 2013 whey protein concentrate recall, Federated Farmers believes the $300,000 fine is proportionate.

“To a shareholder, $300,000 is much better than what the cooperative potentially faced,” says Willy Leferink, Federated Farmers Dairy Chairperson.

“Given the size of negative coverage relating to the non-botulism scare and the dent it put into the coop’s reputation, the size of the fine is proportionate.

“Especially given Fonterra did not contest the charges brought by MPI. Even the Crown Prosecutor acknowledges Fonterra has swiftly moved to put its house in order.

“As supplier shareholders and unit holders will ultimately meet the cost of the fine, we are certain Fonterra’s management has got the message loud and clear,” Mr Leferink concluded.

The company has implemented changes which show it has got the message.

This is vitally important because it’s not just Fonterra but the country’s reputation for food safety which would be damaged by another debacle.


Rural round-up

March 26, 2014

Environment and the economy are one in the same thing – Lynda Murchison:

“It’s a classic case of environment versus economics”, commented Parliamentary Commissioner Jan Wright in her report into water quality.

Economics certainly plays a part in addressing water quality issues but as a geographer, environmental planner and farmer I cannot look at fresh water as a choice between economics and the environment. The notion that environmental protection and economic development are potentially conflicting goals is not, in my view, a recipe for success. It removes any expectation that businesses should take responsibility for protecting the environment; or that environmentalists need to consider social or economic costs of environmental outcomes.

In my world, economic and environmental considerations are two sides of the same coin. It is hard to be green if you are in the red; but you cannot have long-term social or economic prosperity if you undermine the natural capital you rely on to create it. This link between economics and the environment is recognised in the purpose of the Resource Management Act 1991, the main statute that manages natural and physical resources in New Zealand. The purpose of the Act is not about economic development, nor environmental protection. It is to promote the sustainable management of natural and physical resources – a concept that encompasses environmental, economic, cultural and social well-being. . .

PGP Forestry programme takes big step forward:

Primary Industries Ministers Nathan Guy and Jo Goodhew are welcoming commercialisation of new forestry technology this week as a big step forward in improving both productivity and safety.

“The Steepland Harvesting Programme is a very exciting Primary Growth Partnership (PGP) project, with $6 million in joint funding from the industry and the Government and a vision of ‘No worker on the slope, no hand on the chainsaw’,” says Mr Guy.

The new technology involves harvesting on steep slopes using new mechanised technology, rather than exposing forestry workers to risk.

The project was demonstrated to around 55 forestry contractors and company representatives at a Future Forest Research field day in Maungataniwha forest near Napier this week.

“These are the first products from the Steepland Harvesting Programme to be put into commercial use, which is an outstanding accomplishment,” says Mr Guy. . .

Federated Farmers looks beyond China exports:

The Prime Minister has focused on pushing trade with China this week, but sheep and beef farmers are trying to push their products to as many markets as possible.

The industry has faced a number of hurdles in recent years, including drought, a high Kiwi dollar and problems with Chinese border controls.

Federated Farmers meat and fibre chair Jeanette Maxwell says while much of the talk is about more trade with China, her industry believes it is important to get into multiple markets. . .

Fonterra food scare good for Irish milk industry:

Ireland’s Agriculture & Food Minister says Irish dairy companies gained new business off New Zealand during Fonterra’s food scare crisis last year.

Simon Coveney has been in New Zealand to learn how Ireland could also become a global dairy giant.

Mr Coveney told TVNZ’s Q+A programme, that at the time of the food crisis, customers were worried about relying on New Zealand suppliers:

“At the time of that difficulty I had a number of trade missions at the time. One was to the Middle East, and people were starting to say to me, look we source a lot from New Zealand, we like New Zealand we like Fonterra, we think they give us very good product, but we think we’re overly reliant on one supplier. And so a lot of countries are now looking at Ireland as a second supplier in case something goes wrong with their primary supply source.” . . .

Poor rail threatens food boom – Julie-Anne Sprague:

THE disgraceful state of rural railways means grain growers could become uncompetitive and miss out on big profits from the Asian food boom, warns GrainCorp chairman Don Taylor.

The chairman of eastern Australia’s biggest grains handler says urgent spending is needed on the railways.

“We don’t have any right to benefit from the food boom; we have to earn it,” Taylor tells The Australian Financial Review.

“The Canadians want to participate in [the Asian food boom]. The Ukranians are investing and doing things to participate in it. . .

How much would you pay for socks? – James Griffin:

How much would you pay for socks? Socks, actual socks that go on your feet, one per foot, not socks as a euphemism for a word that sounds a lot like “socks”.

Think about it a moment. Then settle on the absolute highest amount of dosh you would be willing to lay out for one pair of socks.

If that number is $1744.88 (or thereabouts, depending on what the exchange rate today is for £895) then, boy, have I got the socks for you. . . .

 


Fonterra accepts MPI charges

March 13, 2014

The Ministry of Primary Industries has filed charges against Fonterra over last year’s whey protein concentrate incident.

Charging documents have been filed for the following four charges:

  • Processing dairy product not in accordance with its Risk Management Programme
  • Exporting dairy product that failed to meet relevant animal product standards
  • Failing to notify its verifier of significant concerns that dairy product had not been processed in accordance with its Risk Management Programme
  • Failing to notify the Director General as soon as possible that exported dairy product was not fit for intended purpose.

MPI cannot make further comment as the matter is before the courts.

In a newsletter to shareholders, Fonterra chair John Wilson says the company accepts the charges:

  • We have announced that we have accepted all four charges, which are consistent with the findings of our Operational Review, and the Independent Board Inquiry.  A copy of our media release will be on fonterra.com.
  • The business is implementing the recommendations of the Operational Review and Independent Board Inquiry.

I’m pleased the company accepts the charges and that it is already implementing the recommendations resulting from the review and inquiry.

Fonterra let consumers, shareholders, the country and itself down over its handling of this incident.

Accepting the charges shows it accepts that.

Even more important is that it has already implemented very necessary changes to its processes and procedures.


Fonterra has learned

January 14, 2014

Fonterra has issued a voluntary recall of Anchor and Pams fresh cream bottles, after tests revealed the possibility of contamination by  E. Coli.

Fonterra Brands NZ is today conducting a voluntary recall of 300ml and 500ml bottles of Anchor and Pams fresh cream with a best before date of 21 January 2014, distributed in the North Island from Northland to Turangi, including Gisborne.

The recall involves 8,700 bottles of fresh cream that have been distributed to retail and foodservice outlets.

Fonterra Brands NZ Managing Director Peter McClure said the voluntary recall is being done because quality tests have shown there may be the presence of E.Coli in some Anchor and Pams bottles of cream with the 21 January 2014 best before date.

“We are sorry for the inconvenience and concern this recall might cause but food safety and quality are our top priorities,” said Mr McClure.  

Consumers are advised not to consume this product and to return it to the place of purchase for a refund. If they require further information, they should contact Fonterra Brands’ customer service centre on 0800 256 257.

This recall does not affect any other Anchor or Pams products.

The affected batch numbers are:

Product Batch Number Best Before Date
Pams Cream 500ml 1400684206 21/01/2014
Anchor Cream 500ml 1400684207 21/01/2014
Anchor Cream 300ml 1400684208 21/01/2014
Pams Cream 300ml 1400684209 21/01/2014

The way this has been handled shows Fonterra has learned from the many mistakes it made in precautionary recall of products in the botulism scare.

This time the company has the news on its website giving all the details consumers need.

No business wants to do a recall but doing it properly, as Fonterra is this time, rather than damaging a reputation can improve consumers’ trust in a company and its products.


Danone takes Fotnerra to court

January 9, 2014

French food company Danone is taking Fonterra to court and terminating its contracts:

. . . Danone is terminating its existing supply contract with Fonterra and making any further collaboration contingent on a commitment by its supplier to full transparency and compliance with the cutting-edge food safety procedures applied to all products supplied to Danone.

Danone is also initiating proceedings in the New Zealand High Court, as well as arbitration proceedings in Singapore to bring all facts to light and to obtain compensation for the harm it has suffered. . .

Danone is the parent of Nutricia which had to recall its infant formula during Fonterra’s botulism scare.


Food safety good but can be better

December 12, 2013

Primary Industries Minister Nathan Guy and Food Safety Minister Nikki Kaye say the government has accepted in principle all the 29 recommendations in the report on the first stage of the Government Inquiry into the Whey Protein Concentrate Contamination Incident.

“This part of the inquiry focused on our dairy food safety system and we are pleased to confirm it found the whey protein concentrate (WPC) incident in August this year (2013) was not the result of any failure in the regulatory system,” Mr Guy says.

“The inquiry report finds New Zealand’s food safety regulatory model is consistent with international principles and is among the best in the world,” Ms Kaye says.

“This is a finding of fundamental importance to reassure our off-shore markets,” Mr Guy says.

“The report was peer reviewed by an international expert in the structure and management of food safety systems, Professor Alan Reilly who heads the Food Safety Authority of Ireland. He confirmed he was satisfied with the quality and integrity of the inquiry’s report,” Ms Kaye says.

“The report makes a number of recommendations, most of which are about further strengthening the New Zealand food safety system for the challenges that lie ahead.”

“Exports to China have trebled since 2007. On top of that, food safety requirements and systems are continuing to evolve,” Mr Guy says.

“New Zealand’s export performance depends heavily on the success of the dairy sector and we are committed to ensuring its underpinning food safety system remains world-leading.”

The Government will allocate between $8-12 million per year for the following key recommendations:

  • Strengthening capability in emerging export markets, particularly China. Additional personnel are needed to support growing China trade. The Government has committed to an additional four people in China and six people in other international markets. The specific location of personnel will be agreed between the Minister for Primary Industries, Minister for Food Safety, Minister of Foreign Affairs and Minister of Trade. The Government has committed an additional $4.430 million in 2014/15 rising to $8.295 million in 2017/18 and out-years to increase the Ministry for Primary Industries (MPI) presence overseas.
  • Establishing a centre of food safety science and research. This will bring together New Zealand government agencies and research organisations allowing for collaboration, including with overseas science centres. (At least an additional $5 million per year made up of contributions from Government and industry.)
  • Increasing dairy processing and regulatory capability. A working group will be set up to develop a strategic plan and this will see a further $1 million per year invested in dairy capability.
  • Establishing a food safety and assurance advisory council to provide high level independent advice and risk analysis. ($250,000 per year.)
  • Fast-tracking work to consolidate and simplify legislation and regulations. ($250,000 for 2014/15.)

“The inquiry report also recommends we fast-track the revision of New Zealand regulatory requirements for the manufacture of infant formula and work is already underway on this,” Ms Kaye says.

“This is a special work programme due to the vulnerability of babies and young children.

“Legislative change is required to meet some of the recommendations and we will be delivering some of that through the Food Bill, which we hope to pass as soon as possible next year. We are looking at aligning other food legislation with an omnibus bill in 2014,” Ms Kaye says.

“The inquiry findings and recommendations should renew confidence in New Zealand’s dairy food safety system,” Mr Guy says.

“We would like to thank the inquiry team, led by Miriam Dean CNZM QC, for completing this report within three months.”

This report released today is on Parts B and C of the Government’s inquiry and is separate to the compliance investigation being undertaken by the Ministry for Primary Industries (MPI). Part A of the Government’s inquiry will look at the question of what happened and the regulator’s response.

In August, MPI indicated the compliance investigation would take three to six months to complete. Part A of the Government’s inquiry cannot be completed until that compliance investigation is completed.

Federated Farmers says the report says our food safety system ‘isn’t broke but needs a tune-up‘.

“Whilst the report puts some minds at ease, confirming the regulatory system is not to blame, it also highlights the need for a stronger food safety system and a stronger understanding of the markets we deal with,” says Willy Leferink, Federated Farmers Dairy Chairperson.

“If our dairy industry is to continue to go from strength to strength, we need to invest more into the framework of how we operate here and overseas. As we diversify into foreign markets, we need people that understand them.

“Before we get there we need to get things right at home. I am thrilled at the recommendations to simplify the regulatory processes and invest in more science and research. Food safety is paramount for the dairy industry and it has long been overdue that we put our money where our mouth is.

“This substantial investment of $8-12 million will go a long way to rebuilding our reputation overseas,” concluded Mr Leferink.

Our reputation for safe food is our biggest marketing advantage and people’s health depends on the reality matching the reputation.

We need the best system of regulating and enforcing food safety possible and these recommendations ought to ensure we have it.

A copy of the report can be found here.

A table of the recommendations and the government’s response is here.

 


Jury still out

November 14, 2013

Fonterra’s internal report on the  botulism scare was full and frank.

The company has said it will implement all 33 recommendations.

It must because as Federated Farmers chief executive Conor English told the international food safety conference,  food safety is New Zealand’s number one issue – and the botulism scare was damaging and a massive risk for the economy.

Mr English compared it to Christchurch’s February 2011 earthquake.

“The stuff that happened with Fonterra and the dairy industry is very like the earthquake … and if they can’t get, frankly, their s*** together so that they are better for it – then I think New Zealand’s in a lot of trouble.

“So I hope, that they do – but the jury’s out for me, to be honest.”

These are strong words.

The earthquake killed lots of people and in the end no lives were at risk from the contaminated why protein.

But a real health threat in any of our dairy products would have as devastating an impact as the earthquakes have.

Fonterra is our biggest exporter and the fallout from the botulism scare shows the damage goes much wider than the company when something goes wrong.

That it appears not to have done any lasting damage has been in spite of the company’s inept handling of the issue when it broke and in the immediate aftermath.

The director of Victoria University’s contemporary China research centre, Xiaoming Huang, said Fonterra’s problem was not as big a deal in China as it might appear from New Zealand.

Professor Huang said New Zealand food still has a very good reputation and believes the public over-reacted.

The Global Food Safety forum’s founder, Rick Gilmore, said time will tell if New Zealand’s response so far is the right one.

“Agricultural and ag exports are so important to the New Zealand economy, that you can’t afford to do otherwise. I think everybody recognises that. So my impression is that New Zealand has held on to its claim to be a food safety model.”

That’s reassuring but no excuse for complacency.


NZ-China food safety agreement signed

November 3, 2013

Food Safety Minister Nikki Kaye welcomed a food safety agreement signed today between New Zealand and China to strengthen cooperation in food safety and food quality.

The Food Safety Cooperation Arrangement between the Ministry for Primary Industries(MPI) and the China Food and Drug Administration (CFDA) was signed today in Wellington by the Chinese Vice Minister, Liu Peizhi and MPI Deputy Director General Carol Barnao.

“This is an important agreement that will be beneficial to both countries,” Ms Kaye says. “It will encourage cooperation and the sharing of knowledge in the fields of food safety, risk management, food standards and regulations.

“The agreement shows commitment and a willingness between New Zealand and China to work together on food safety programmes.

“It will allow MPI and the CFDA to work together to enhance food safety, continually improve our regulatory regimes and enhance the bilateral relationship.”

The agreement will see a Joint Food Safety Commission (JFSC) established to enhance food safety regulatory cooperation.

“The JFSC will allow MPI and the CFDA to meet on an annual basis to help build a better understanding of how our respective food safety systems work. We can identify areas of shared interest and potential new areas of cooperation,” Ms Kaye says.  

“The agreement also allows us to formalise our joint interests and is an important step in the evolution of China and New Zealand cooperation in food safety. 

“It will further build on the strong relationship that our two countries share, particularly in the agricultural and food sectors.”

This should be good for exporters and consumers.

Food safety is very important in #gigatownoamaru.


Rural round-up

October 30, 2013

Beef + Lamb New Zealand Puts Case to Washington:

Beef + Lamb New Zealand (B+LNZ) and representatives from other Five Nations Beef Alliance partners have called on Washington’s Capitol Hill to promote a unified view of how trade in agricultural products – and especially beef – should be treated under the Trans-Pacific Partnership (TPP) agreement.

The TPP, which is currently being negotiated and of which New Zealand is a participant, aims to open up trade in goods and services. Progress towards an outcome was most recently reviewed in Bali, where Prime Minister John Key chaired the meeting of the 12 TPP negotiating countries.

The Five Nations Beef Alliance is made up of the national organisations that represent beef cattle producers in Australia, Canada, Mexico, New Zealand and the United States. Collectively, the five countries account for one third of global beef production and approximately half of global beef exports. . .

New Zealand food and beverage producers need to be bulletproof:

New Zealand food and beverage producers need to ensure their operations are “bulletproof” if they want to compete in an increasingly aggressive global marketplace, an industry expert says.

Grant Thornton New Zealand Partner and National Leader, Food and Beverage, Simon Hunter, is describing the firm’s latest International Food and Beverage sector report, ‘Hunger for growth: Food and Beverage looks to the future’, as a wake-up call for the local industry.

The report, based on interviews with 248 senior executives in seven countries (including New Zealand), says 90% expect revenues to increase in the next 12 months but only half expect to employ more people. . .

Gigatown competition will change the future for one town:

Federated Farmers is excited by Chorus’s year-long competition to bring the fastest broadband speed to one New Zealand town.

“This competition is a great opportunity for rural towns,” says Conor English, Federated Farmers Chief Executive.

“If a rural town wins it will become the first town in the southern hemisphere to receive one-gigabit per second broadband speeds – up to 100 times faster than most cities around the globe.

“New Zealand’s farmers are desperate for new ways to get onto the internet and this competition has the potential, for one fortunate town, to spark innovation and mobilise and transform their local economy and society. . . .

(This is why we’re supporting #gigatownoam and the #gigatown campaign).

Fonterra board to set up separate risk committee after food scare review – Paul McBeth:

(BusinessDesk) – The board of Fonterra Cooperative Group will establish a separate committee to oversee risks facing the dairy group in the wake of the false alarm food scare that prompted a precautionary recall in August.

The company’s board will carve out the risk elements from its audit, finance and risk committee into its own separate committee, which chairman John Wilson said will cover “food safety, food quality and other risks Fonterra in today’s environment faces.”

The measure was one of a raft of recommendations from the board-ordered inquiry, led by Jack Hodder QC, after recall of three batches of whey protein concentrate, which were thought to have been contaminated.

Fonterra’s handling of the fall-out was “inadequate” for the kind and size of the crisis and the company’s lack of responsiveness to external stakeholders was seen as a “fortress” mentality, the report said. . . .

Shareholders’ Council welcomes report, inquiry recommendations:

The Fonterra Shareholders’ Council, which safeguards the interests of the dairy Co-operative’s 10,500 Shareholders, said it welcomed the completion of the Fonterra Board commissioned independent report of the WPC80 issue.

Council Chairman, Ian Brown: “The Council has received the report and we commend the Oversight Committee and the Independent Inquiry Team on the comprehensive nature of the report.

“We also commend the Board on their openness and support their decision to make the report public. . .

New health & safety regulations will increase potential penalties for employers:

The potential for higher penalties for non-compliance as a result of upcoming changes to Health and Safety regulations means employers in the high-risk agricultural sector need to be more aware than ever of their obligations, says Melissa Vining, AGRI Consultant for human resources specialists Progressive Consulting – the HR division of Crowe Horwath.

The government will establish new Crown Agent WorkSafe New Zealand by December 2013, when it also plans to introduce to parliament a new Health and Safety at Work Act, which is expected to come into force by December 2014. . . .

Xero releases farming blueprint:

Xero has released its Farming Integration Guide, a blueprint that helps rural solution providers connect to Xero and deliver integrated farm management and accounting solutions. 

Xero CEO Rod Drury says this is a great example of technology bringing an industry together. “This guide is the key step towards full integration between farmers, rural accountants, rural suppliers, banks and software providers. The innovation we’re experiencing in the tech sector is being applied directly now to the rural economy, the backbone of the NZ economy.” . . .


33 recommendaitons in independent review of contaminated whey protein

October 29, 2013

The independent inquiry into Fonterra’s contaminated whey protein concentrate has made 33 recommendations.

In a detailed report, the inquiry found that a number of factors, including a lack of senior oversight of crucial decisions, problems with tracing potentially affected product and belated escalation of the issue, contributed to the event in August this year. 

Speaking at the tabling of the inquiry report in Auckland today, Jack Hodder QC, who led the inquiry team, said: “Fonterra is a high quality organisation with talented and dedicated people. The WPC80 Precautionary Recall let them down. 

“There were shortcomings in a number of areas, which, compounded by a number of events and co-incidences, converged to create this significant issue. 

“Our findings and recommendations do not indicate any fundamental problems within Fonterra. That is not our conclusion. 

“They do point to a range of improvements Fonterra can make to become an even better company.“

The Chairman of the special oversight committee for the inquiry, also an independent Fonterra director, Sir Ralph Norris, said his committee “endorsed the key recommendations and themes identified by the inquiry team… It has undertaken a thorough, consultative, independent and incisive analysis.”

The inquiry team was led by a legal team from Chapman Tripp, co-ordinated by senior partner Jack Hodder, QC, and independent experts Gabrielle Trainor, a Sydney-based specialist in crisis management and communication, and international dairy consultant, Jacob Heida of the Netherlands.

 “The inquiry team recognises that Fonterra is well advanced on a journey from being a cost-focused dairy ingredients producer to being a customer-focused global foods products supplier that is second to none in its aspirations, standards and people.

“Some areas of weakness have been highlighted, and this has created the opportunity for Fonterra to further strengthen it processes, culture and governance. 

“Acting on the recommendations made will lead to Fonterra becoming even more responsive to the global expectations of excellence in food safety and quality, and engaging more comprehensively with stakeholders.

“The findings and recommendations are important foundations for Fonterra’s continued success.”

 The Chairman of Fonterra, John Wilson, told the media briefing that the board of Fonterra was fully committed to implementing the recommendations made.

“What directors found encouraging is that this Independent report to the Directors has a significant degree of overlap with management’s Operational Review, which was made public last month.

“There are no contradictions between the two sets of recommendations.

“Much of the recommended change is already underway, or has already been identified as needing to be changed.

“We are committed to adopting a ‘best of class’ philosophy around food safety and incorporating the latest, world class methods into every facet of our operations.”

He said the board had also committed to the reconvening of the Independent Inquiry Committee in 9 months, and again in 18 months, to assist the board in reviewing the progress that has been made against the recommendations.

In an email to shareholders, Fonterra chair John Wilson said:

  • There are 33 recommendations, 24 relating to operational issues and many of them overlap with management’s operational review findings.
  • We asked the inquiry team to challenge every aspect of the business to find out what happened and why, to reduce the chance of this ever happening again and to make our Co-operative stronger.
  • It finds Fonterra does most things extremely well and the report says we are “already operating at a high quality level in almost all respects”.
  • The crisis was complex involving many customers, many countries, languages and cultures.  It was on a scale most companies never face.
  • Problems escalated because senior management and the Board were left out of the loop too long and we lost time needed to get an effective plan in place.
  • A change in computer systems compounded difficulty in obtaining accurate information.
  • The report is thorough and the Board accepts its findings and recommendations.

Here is the summary of the findings and recommendations from the report:-

Primary findings of what happened

  1. Fonterra did not include any sulphite reducing clostridia (SRC) tests for any of its production of WPC, even though it had accepted SRC tests under at least one contract with a major customer.
  2. Some errors of judgement were made in preparation for the reworking process applied to the relevant WPC80 batches.
  3. The standard pre-start up automatic cleaning regimes used by Fonterra plants required improvement.
  4. There was insufficient senior oversight of the crucial decision to engage AgResearch to test for C. botulinum.
  5. The commissioning, design and limits of the C. botulinum testing were inadequate.
  6. Fonterra was unable to promptly and definitively track the destinations of the affected WPC80.
  7. There was only belated recognition (and delayed escalation to senior management and the Board) of the explosive reputational risk involved – a failure to “join the dots” between a) C. botulinum b) infant food products c) consumer sensitivities and d) Fonterra’s global reputation.
  8. Fonterra’s crisis management planning, including the external communications aspects, was inadequate for a crisis of this kind and scale.
  9. Fonterra management of the crisis in the critical early period, including the external communications aspects, was not well executed.
  10. There was some lack of alignment and confidence between Fonterra and the New Zealand Government in the critical fortnight after the contamination concerns were advised to the Government and made public.

Principal operational recommendations

  1. Fonterra’s food quality and safety specifications and testing be reviewed to ensure they are “best in class” standard: consistent with the most rigorous requirements of customers, and with international best practice.
  2. Risk management and crisis management processes be strengthened, including by establishment of a specially trained and multi-disciplinary (but not full-time) Incident Management Team and regular relevant training, global best practice product tracing systems, and a new Risk Committee of the Board.
  3. Reputational risk assessment form part of the criteria for escalation and assessment of non-standard external scientific tests.
  4. Plant cleaning programmes be amended.
  5. There be continued building of a directly-employed strong, specialist and experienced communications team, including in key global markets, supplemented with contracted high calibre local expertise where appropriate.
  6. There be enhanced and sustained efforts to address a “Fortress Fonterra” perception held by a material proportion of key stakeholders, by Fonterra redefining the style and substance of its engagement with them.
  7. The Inquiry be reconvened after 9 months and again after 18 months to review Fonterra’s progress on those recommendations.
  • The report notes that the recommendations are “essentially in the nature of incremental improvements and consistent with Fonterra’s pre-existing commitments to both food quality and safety and to continuous improvement.”
  • On the operational side, we will have a specific focus in relation to the re-working process, risk management, testing for contaminants, cleaning processes at our plants, escalation of problems, operational planning, and communications.
  • The Board will split out a specific Risk Committee from the current Audit, Finance and Risk Committee to provide a separate emphasis on managing risk across Fonterra, providing an overview to ensure our management team continues to improve our processes, monitoring and risk escalation right through our Co-operative.
  • Our priorities are to ensure the operational review is completed, the independent inquiry team’s recommendations are acted on, and that future crisis management is “best in class”.
  • Most importantly, we must take all stakeholders with us and make those relationships stronger.
  • I have huge confidence we will build on our world class reputation for food safety and quality.

The executive summary starts by pointing out:

. . . any major inquiry will tend to accentuate a few negative considerations. This tendency requires a balancing reminder about the many positive considerations – here including the impressive quality of Fonterra’s people and plants, and its pre-existing commitments to food safety and quality and continuous improvement across the organisation.

This is a reminder that although lots of things went wrong and the subsequent reaction was handled badly, the company itself gets most things right.

The report’s brief was to determine what went wrong and what needs to be done to avoid it happening again.

It has done that and it is up to Fonterra to act on the recommendations to do everything it can to prevent any further food safety issues and to ensure it is prepared to respond if, or when, there is a problem in the future.

The full report is here.

The government is undertaking a ministerial inquiry and the Ministry of Primary Industries is doing a compliance investigation, both of which are expected to be completed by the end of the year.

 

 


Orange and red flags ignored

October 10, 2013

Months after the precautionary recall of products containing whey protein which was later proved to be clear of botulism there is still a lot of confusion about what happened.

Keith Woodford explains it was all about orange and red flags:

. . . It all started back in May 2012 when some plastic came loose in a whey concentrate dryer at the Hautapu plant near Hamilton. The risk was that this plastic had got smashed up and possibly melted within the dryer, and then mixed with the whey.

The only way to find out for sure was to hydrate the whey powder (which is soluble) and then filter out any solids.  For reasons not clear, Fonterra chose to do this using equipment that had not been used recently.  Unfortunately the equipment had not been properly cleaned.

Once hydrated and then re-dried, the product passed the mandatory bacterial tests, but did have a level somewhat higher than typical.

By this stage there should have been two orange flags but the Fonterra system recognised neither.  The first was that once the product had been reprocessed, then it should have been drafted away from human use and used for stock feed. The second orange flag was when the re-processed whey powder gave elevated but technically acceptable bacterial counts. Once again, this should have been enough to restrict its use to stock feed. . .

He explains what happened next and about the testing in the clearest summary I have come across. It is very interesting reading.

He then gets on to the ongoing fallout:

. . . As events have turned out, it is now apparent that it was a false alarm. Further testing overseas has confirmed that in fact it was not botulinum.  However, great damage to Fonterra’s and New Zealand’s reputation occurred, with the recall being splashed globally in the news media, and particularly so in China  where many of Fonterra’s products are sold. In fact I am writing this from China, and I can confirm that it has very much come to the attention of Chinese consumers.

It will be interesting to see how this now plays out. Here in China there is no doubt that Danone in particular has suffered great damage, with their leading infant formula brand Dumex being particularly badly hit. (Dumex is the equivalent of ‘Karicare’ in New Zealand, with Karicare being marketed by  Danone’s  Nutricia subsidiary.)  .

Earlier this week, in a Shanghai supermarket, there was a message over the in-store radio every five minutes advising that the Fonterra food safety scare was actually a false alarm. But unofficial sources tell me that sales of the Dumex brand are still hugely affected, with up to 90% loss of sales. Consumers have moved to other brands and now have to be painstakingly won back. A Google search using Chinese characters for ‘poisonous’ and ‘milk powder’ and ‘Dumex’ produces over one million references. . .

There is an irony that Fonterra’s milk powder is still flowing into China unimpeded, and prices for these bulk products have not suffered.  It is the consumer brands that are not owned by Fonterra that have suffered. . .

It isn’t just milk products which are affected:

Glen Herud at Milking on the Moove was speaking to a food safety consultant recently:

He has a client who manufactures and sells blackberry powder to the Asian market.

His product has been stopped from entering into some Asian countries. 

He was notified by his customer via an email in broken English explaining that they won’t purchase anymore product because botulism was in New Zealand products. . . 

Inquiries into exactly what went wrong at Fonterra and the subsequent handling of the issue are continuing and so are the consequences.

Whatever comes out of the inquiries, all food processors need to be sure they have systems which recognise and respond appropriately to orange flags long before any red ones are raised.


Taranaki landfarms fit for purpose

October 5, 2013

An investigation  commissioned by the Taranaki regional Council has found that landfarms are fit for purpose.

Doctor Doug Edmeades of AgKnowledge  who undertook the investigation found:

1. Waste products (rock cuttings and drilling muds) from the oil exploration industry in Taranaki are being incorporated into  re-contoured formed sand dunes and re-sown back to pasture (a process referred to as Landfarming). This process is controlled by resource consents issued by the Taranaki Regional Council. Three Landfarms have been completed to date and are now being farmed commercially (2 under irrigation).
 
2. The drilling muds contain potential contaminants: petrochemical residues, barium, heavy metals and salts. The question arises: are these reformed soils ‘fit-for-purpose’ – in this case pastoral farming and especially dairy farming.
 
3. As required by the consents regular soil samples were collected and analysed during the disposal process. These results were summarised and examined relative to the permitted limits for the various potential contaminants.
 
4. The completed sites were visited and the pasture and soils inspected. Soil and pasture samples were collected and analysed for all potential contaminants. These results were compared to the properties of normal New Zealand pastorals soils.
 
5. It is concluded from this body of evidence that these modified soils are ‘fit–for-purpose”. The concentrations of: nutrients (macro and micro), heavy metals and soluble salts in these soils and pasture are similar to normal New Zealand soils. The form of barium present is as environmentally benign barite, and there is no evidence of accumulation of petrochemical residues.
 
6. The process of Landfarming these otherwise very poor soils, together with appropriate management (irrigation, fertiliser and improved pastures) has increased the agronomic value of the land from about $3-5000/ha to $30-40,000/ha.
 
Federated Farmers had earlier called Green Party concerns about these properties as scaremongering and is buoyed that an independent scientific investigation has confirmed these farms are not only safe, but may be better for the environment.
 

“Federated Farmers congratulates Taranaki Regional Council for commissioning Dr Doug Edmeades of AgKnowledge to test landfarming,” says Harvey Leach, Federated Farmers Taranaki provincial president.

“If you happen to be a farmer with less than even pasture or soil quality, then the cliché, ‘One man’s trash is another’s treasure,’ very much applies. Landfarms recycle the mud, rocks and clay that comes from mining so is smart recycling.

“The blending of this material into the sand makes it worthwhile to add fertiliser and to put in place irrigation infrastructure. Simply put there is soil.

“These landfarms are also monitored and tested by Taranaki Regional Council and Dr Edmeades study vindicates both the concept and the council’s monitoring approach.

“That’s why the negative claims made about landfarms in Taranaki were so thin they could model in Paris.

“Dr Edmeades is a scientist who has completed an ANZAC Fellowship and was National Science Program Leader (Soils and Fertiliser) for AgResearch. In 1997, he established his own science consulting business, which became AgKnowledge.

“Dr Edmeades is an expert in his field. His report concluded that landfarming made sandy and highly erosion prone coastal farmland, ten times better for dairy farming. That is both an economic and environmental win since these farms previously had poor soils.

“Because of the value and productive uplift from landfarming, it has allowed better management practices to be adopted.

“His report found that the concentrations of heavy metals in the landfarms were at the low end of the range, when compared to soils from various regions in farmed and non-farmed areas. That is a positive.

“While hydrocarbons were found on the most recently completed landfarm, Dr Edmeades said these levels would decline as soil microbes broke them down.

“Being a farmer, I know that earthworms are a strong indicator of soil health and Dr Edmeades found them in large numbers. That’s a key thing for me because he described earthworms as a soil scientist’s ‘canary in the mine’.

“At least we now have a robust independent scientific report saying that landfarming is not only safe but can be environmentally positive. That’s why we need to base discussion on hard facts and evidence and not for short-term political gain,” Mr Leach concluded.

Fonterra had stopped taking milk from new properties on land farms because of the cost of tests.

The perception of a safe clean dairy industry was also a factor.

Perception beats reality – it will probably beat the science because those dark green anti-dairy campaigners only back the science which suits their case.


Rural round-up

October 4, 2013

Whisky-fed salmon to boost sustainability:

The whisky and salmon industries in Scotland are about to embark on an innovative new partnership which will convert waste from whisky production into feed for salmon and fish farming.

Over 500 million litres of whisky are produced in the UK each year. But for every litre of whisky produced, up to 15 litres of potentially harmful waste can be generated1.

Chemical engineers from Heriot-Watt University in Scotland are looking to solve this problem by converting some of the waste into protein-rich feed, which could have the added benefit of providing a sustainable and economic supply of feedstock for the growing Scottish fish farming industry. . .

Synlait Milk – Champion Global Operator at Champion Canterbury Business Awards:

Synlait Milk has won the Champion Global Operator Award (large to medium enterprise) at the 2013 Champion Canterbury Business Awards. This is the second consecutive year that Synlait Milk has won this award.

“Winning the Champion Global Operator Award for the second year running is testament to our business strategy and the effort from all our staff,” says Synlait Milk Managing Director John Penno.

“The award caps off a great year for the Company in which we successfully began trading on the NZX Main Board, after completing a positive Initial Public Offering, in addition to posting an after tax profit of $11.5 million for FY13,” says Mr Penno. . .

Jobs under threat as meat company makes changes:

Jobs are on the line as the country’s biggest meat processor, Silver Fern Farms, makes adjustments to its North Island operations.

The co-operative is making changes as the new season gets underway with the prospect of lower stock numbers from the summer drought.

Silver Fern is consolidating beef processing in Waikato and negotiating to sell its skin processing plant near Shannon.

The firm is considering an offer from the Lowe Corporation to buy the ageing Shannon fellmongery, which employs more than 80 workers. . .

Nutricia Restates Quality and Safety Assurance with Extra Commitments:

Infant formula manufacturer Nutricia has restated its world-class commitment to quality, safety and transparent communication, with three extra commitments:

1. Extra controls on suppliers
2. Innovation to improve industry standards 3. Extra commitment to communication with parents and carers

These extra commitments enhance Nutricia’s established quality and safety procedures of rigorous testing, state-of-the-art manufacturing, comprehensive sanitation and hygiene, quality & safety accreditations, and traceability. . .

Pure ambitions for Angus brand – Tim Cronshaw:

A new-look angus brand providing premium payments for farmers will be announced at the World Angus Forum.

Details of the Angus Pure brand development have yet to be revealed, but will centre around new criteria being set for selecting meat carcasses. This will be unveiled during a secretariat meeting at the forum to be held in Rotorua from October 13 to 16.

Forum chairman Tim Brittain said the extension to the brand would offer opportunities for the New Zealand food service sector and for sales to the international marketplace. . .

The diary of a teenage bee – Raymond Huber:

A female bee lives for only about six weeks in summer. But it’s a life lived to the full because she’s constantly changing jobs: from cleaner to babysitter, builder, honey-chef, queen-groomer, guard, forager, undertaker and scout. Here is the diary of a teen bee:

Week 1    Dear Diary, So unfair! The work started the moment I hatched. I had to clean out my birth cell (ew!), then spend the whole week tidying the rest of the hive. My older sisters call me a ‘house bee’ and say I’m not allowed outside ‘til I’m 21 days. And I’m like, no way sister!

Week 2   Dear Diary, Yay! I’m a babysitter. The babies are sooo cute but totally exhausting. I have to check them 1300 times a day (okay, call me obsessive) to make sure they’re okay.  Meanwhile the comb cleaning goes on 4EVAH…

NZer secures top Irish horse for Cup:

Irish St Leger winner Voleuse De Coeurs will be aimed at the Melbourne Cup after New Zealand bloodstock agent Paul Moroney secured the mare in a surprise deal.

Voleuse De Coeurs’ Cup price was slashed to $A17 from $A34 after the announcement she would leave Dermot Weld to be trained by Moroney’s brother Mike Moroney, who is based at Flemington.

The mare will be flown to Newmarket for her quarantine and is expected to arrive in Australia on October 19. . .


Rural round-up

October 3, 2013

Taranaki study backs landfarming science – Isobel Ewing:

An independent report on landfarming in Taranaki has vindicated the science behind the process, Taranaki Regional Council boss of environmental quality Gary Bedford says.

In a report commissioned by the council, soil scientist Doug Edmeades, of AgKnowledge Ltd in Hamilton, set out to see if landfarms in Taranaki were fit for pastoral farming, in particular dairy farming.

Dr Edmeades investigated soil fertility, heavy metal and barium concentrates and petrochemical residues in the soil at three landfarming sites in the region.

The report found that landfarming made sandy, coastal farmland ten times better for dairying.

“The process of landfarming these otherwise very poor soils, together with appropriate management has increased the agronomic value of the land from about $3000-5000/ha to $30,000-40,000/ha.” . .

Hardwood project promises billions – Jon Morgan:

When arsenic was found in the aquifer beneath Marlborough’s vineyards in 2003 it sent a shiver of fear through the region. The worry was that the deadly poison would find its way into the wine and sink the then-$400 million industry.

Research found the water source was naturally occurring arsenic and not a danger to health. But it also found arsenic in the soil – from thousands of tanalised pine posts.

A search began for an alternative post. It has taken 10 years, but the group formed to undertake the research and grow the wood – the New Zealand Dryland Forests Initiative – has reached a crucial stage.

Seven eucalypt species have been identified as having the ideal qualities. Seed has been collected, trials planted on farms throughout both islands and the best trees are starting to show.

At the same time, new markets far beyond the 450,000 posts a year needed for Marlborough vineyards alone have been discovered. . .

Forum Will Rebuild New Zealand’s Food Safety Image:

A Dunedin woman has accepted the challenge to help rebuild New Zealand’s food safety image.

Dr Helen Darling, a founder of a company which pioneers global food verification systems, is bringing up to 200 delegates to Otago to address the perception that New Zealand must improve its food safety standards.

The Global Food Safety Forum traditionally meets in Beijing but Dr Darling has persuaded the US based, not-for-profit organisation, to hold it in New Zealand from November 13-15.

A strong emphasis will be to consider and seek solutions to the next crisis before it occurs.

“With food safety, prevention is better than cure. We will look at emerging threats and ways to address them before they become a problem to our producers and for trade.” . .

Drought over but affects will linger:

While the drought of 2013 is now officially over, some farms, especially meat and fibre will see its aftermath linger for years to come.

“While the thankfully benign winter and spring has seen a most remarkable come back in terms of pasture, North Island sheep farmers in particular lost capital stock and quality genetics,” says Katie Milne, Federated Farmers Adverse Events Spokesperson.

“Not to mention their wool crop too. The shame being that it came at a time when wool seemed to be finding its feet

“After speaking to my colleague Jeannette MaxwellI, Federated Farmers Meat & Fibre Chairperson, it means we are looking at fewer lambs this year with speculation it could be upwards of three million. . .

Ready and relevant for 21st century: Lincoln University launches new land-based degree portfolio:

This week Lincoln University has marked a number of significant events. 

On Tuesday 1st October, the University launched its new portfolio of bachelor’s degrees – all of which are now focused on knowledge and expertise that creates careers in the land-based industries, globally.

The new portfolio retains flagships such as the Bachelor of Agricultural Science and Bachelor of Commerce (Agriculture), and introduces new degrees such as the Bachelor of Agribusiness and Food Marketing and the Bachelor of Environment and SocietyAll the new majors have a very clear focus on the land-based sector. 

“These changes reinforce what this University exists to do, which is to help feed the world, protect the future and live well.  Our reform has seen us reduce the number of majors within our degrees from 42 to 24 (43 percent).  We have narrowed our focus and deepened our capacity to be world class where it really counts, in the land-based industries,” says Professor Sheelagh Matear , Assistant Vice-Chancellor, Academic Programmes and Student Experience. . .

Westland trumps its big brother:

New Zealand’s second largest dairy cooperative, Westland Milk Products, has managed to beat Fonterra Cooperative Group with a $6.34 per kilogram of milk solids (kg/MS) payout before retentions.

“That 2012/13 season must rank as one of the weirdest we’ve had here on the Coast,” says Richard Reynolds, Federated Farmers West Coast Dairy chairperson.

“After a promising start, we had a summer flood which washed out bridges before a drought so severe some sections of our rivers like the Taramakau actually dried up.

“Despite all of this, Westland deserves credit for managing to make a surplus of $6.34 kg/MS. That compares to Fonterra’s $6.30 kg/MS before retentions.

“The difference in the final payout is due to Fonterra retaining 14 cents kg/MS while Westland retained 30 cents kg/MS. We are comfortable with what Westland is retaining despite it leaving us with slightly less cash in the hand at $6.04 kg/MS. . .

And the latest parody from Peterson Farm Bros:


No widespread preservative problem in fresh meat

September 27, 2013

The Ministry of Primary Industries is investigating the suspected use of sulphites in meat by a small number of independent butcheries and groceries in the Auckland area.

The investigation led TVNZ’s news a few days ago and MPI is concerned it may have unnecessarily caused consumers concern that there is some food safety risk associated with fresh meat.

But the Ministry said its investigation to date has found  no widespread problem with the use of preservatives in fresh red meat.

“The use of sulphites to prolong the shelf life of fresh meat and freshen up the appearance of greying meat is something that appears to be being undertaken by a small group of “rogue” operators and not mainstream meat suppliers. We targeted these butcheries and grocery stores for further investigation based on our own intelligence gathering.

“We are confident, through conducting our regular food safety compliance activity, that larger retailers including New Zealand’s supermarket chains and reputable, New Zealand-qualified butchers are well aware of the rules and will not be carrying out this practice,” Ministry for Primary Industries Director Animal, and Animal Products, Matthew Stone says.

“MPI will not tolerate flouting of the rules that are in place to ensure New Zealand’s food is safe. The Ministry has a range of legal options at its disposal where evidence is present that this law-breaking is taking place.”

Mr Stone also points out that the issue concerns the handling and retailing of meat in New Zealand domestically and that this is not an issue concerning export meat.

“Consumers need to have confidence, particularly if they are in the small group that have allergies to sulphites, that fresh meat will not have this additive in it.”

Sulphites such as sulphur dioxide are food additives used in a range of foods around the world. In New Zealand its use is controlled by regulation and must be reflected in labelling, which MPI also monitors.

Mr Stone says some initial sampling of fresh meat from 10 Auckland butcheries and grocery stores found the presence of sulphite which is a preservative allowed in processed meat goods (and a range of other foodstuffs) but is not allowed to be added to fresh meat.

He says for this reason, MPI recently carried out sampling of fresh red meat (a range of cuts including mince) from another 27 premises in Auckland.

“We expect to know in a couple of weeks what the true situation is out there. But we need to be clear that the evidence shows that the use of sulphite in fresh meat is not a widespread problem.

“There can be serious consequences for those who break the rules. The incorrect use of additives breaches the Food Standards Code and the Food Act 1981. Under the Act, failure to comply with the Food Standards Code can result in a fine of up to $5000 for an individual or $20,000 for a body corporate. . .

This is a serious issue but it is not a widespread problem.


No single cause

September 5, 2013

When something goes badly wrong, everyone wants to pin the blame on someone or something.

However, often there isn’t a single person or thing at fault, but a series of mistakes and this is what Fonterra has found in the operational review in the wake of the debacle over the precautionary recall of products containing why protein concentrate.

In an email to shareholders, chair John Wilson said:

The Review found that there was not one single cause of the precautionary recall. It was the result of a number of separate and unrelated events occurring in an unforeseen sequence:

  • The decision to reprocess the original WPC80 and not downgrade the product, in combination with the use of an item of non-standard equipment, was the cause of the contamination.
  • A one-off lapse in information sharing across two parts of the business led to delays in testing.
  • This issue should have been escalated to CEO-level earlier.
  • A major upgrade of the computer systems at some of our sites immediately prior to the recall resulted in product tracing taking longer than it should have.
  • Although Fonterra has clearly established domestic and international product recall systems, the size and complexity of the WPC80 recall was a factor, particularly given the product had itself become an ingredient in the products of multiple customers.

Having established what went wrong, the company is determined to improve its practices to prevent a repeat of the problem.

Business Improvements
To help prevent an incident like this happening again, Fonterra will:

  • Ensure our world-class food production standards continue to be maintained at all times, across all sites, in areas such as quality control, testing, and product specifications.
  • Further increase the business’ focus on quality and safety across the end-to-end supply chain.
  • Increase transparency, internally and externally, to improve information flows and the speed of escalation. 
  • Ensure Fonterra strengthens its product recall and supply management systems which allow the tracing of all product that is in its control, and collaborates with customers on how to link different supply chains and quickly trace products.

The business is now making changes based on the lessons learned in this review, including:

  • Establishing the new role of Group Director of Food Safety and Quality reporting directly to the CEO.
  • Strengthening the remit and scope of the Food Integrity Council.
  • Launching an internal Food Safety and Quality Hotline for staff and contractors to escalate any concerns about potential food safety risks.
  • Quality audits have been completed at our sensitive nutritional plants, including Hautapu.
  • Comprehensive staff training on use of an upgraded computer to efficiently trace products across our entire supply chain has been completed.

Other actions to follow involve a review of any upcoming system changes, strengthening our crisis management capability, and reviewing our traceability systems in our global businesses.

The business is also introducing additional authorisation requirements for non-standard processing and testing, and conducting specialised audits of our global manufacturing plants and product quality standards.

We’ll also be looking to implement any findings from the Board’s independent inquiry.

Everything in our power is being done to rebuild absolute confidence in our processes and products, and to strengthen New Zealand’s already strong food safety and quality system – and make Fonterra even stronger for the future.

Now that tests have confirmed there was no botulism risk the company is being criticised for “crying wolf” but it was right to act when there was a risk that babies’ health might be at risk.

Food safety must always come first.

However, while the precautionary recall was necessary, so too was far better communication than the company provided.

Fonterra  did the right thing but it communicated what it was doing and why badly and that is where it let itself, its shareholders, customers and the country down.

Lessons learned from what went wrong must result in improved practices to prevent a repeat and far better communication if there is another problem.


What went wrong at AgResearch?

August 29, 2013

AgResearch isn’t very popular in the south following the announcement of its proposal to relocate most of its activities from Invermay to Lincoln.

It won’t be very popular with Fonterra, MPI, government or anyone else caught up with the fallout from the botulism scare now it’s been found it was responsible for the test which showed the possible botulism contamination in a batch of Fonterra’s whey protein concentrate.

Subsequent tests – all 195 of them – have contradicted that and shown that the WPC was safe.

AgResearch has issued a media release saying:

A spokesperson for AgResearch said: “We have today received correspondence from Fonterra in relation to testing carried out by AgResearch for Fonterra.

“Under the terms of our contract with Fonterra, we are bound by a confidentiality agreement and cannot discuss specific details.

“However, we have reviewed our work and we are confident in the work that our experts carried out and reported to Fonterra.

“Both the Government and Fonterra are conducting investigations into the issues and we are involved in these inquiries.

“We have also sought to discuss the concerns raised today directly with Fonterra and we are engaged with MPI regarding these developments.”

Fonterra chief executive Theo Spierings said while there is a sense of shared relief that the product was not contaminated, Fonterra had done the right thing by initiating a precautionary recall.

“Food safety remains our number one priority.

“The original results from AgResearch indicated the presence of toxin-producing Clostridium botulinum in the affected whey protein concentrate and we could therefore not take any chances,” he said.

Fonterra originally commissioned independent testing from Crown Research Institute, AgResearch, as one of only two research facilities in New Zealand capable of carrying out testing for Clostridium botulinum.

“On the basis of the results we received from the AgResearch tests, we had no choice but to alert regulators, and announce a global precautionary recall with our customers.

“We have just learned of the further and definitive test results. While we share a sense of relief about them, this in no way lessens our commitment to undertaking a thorough review into what happened, and to learn from this experience.”

Mr Spierings acknowledged there had been confusion and anxiety arising from the complexity of the precautionary recall and apologised for it.

“The past few weeks have been very difficult for parents in a number of countries, as well as for our customers, our farmers, and our staff.
“For me, as Fonterra’s CEO and as a father of three children, I truly believe that in initiating the recall, we took the right decision and did the right thing at the most critical moment. Given the same circumstances, and with food safety always front of mind, I would do the same again.

“Food safety and quality must always remain our top priority. I have created a new role of Group Director, Food Safety and Quality that reports directly to me.  Fonterra already has world-class food safety systems, and we’ll make sure that our dedication to food safety is further embedded in everything we do.

“The news today does not affect the various reviews and inquiries underway. We are committed to learning from, and sharing, any findings about how we can improve. We will do this in an open and transparent way,” Mr Spierings said.

There will be lessons for AgResearch too.


Fonterra scare false alarm

August 28, 2013

The Ministry for Primary Industries says 195 tests here and in the USA have shown the Fonterra botulism scare was a false alarm.

The Ministry for Primary Industries has received results confirming that the bacteria found in the whey protein concentrate (WPC) manufactured by Fonterra is not Clostridium botulinum. The organism is confirmed as Clostridium sporogenes. It is therefore not capable of producing botulism causing toxins.

There are no known food safety issues associated with Clostridium sporogenes, although at elevated levels certain strains may be associated with food spoilage.

“When MPI received information from Fonterra on 2 August that it had detected Clostridium botulinum in some of its products, I immediately adopted a precautionary approach to protect consumers both here and overseas,” acting director-general Scott Gallacher said today.

“We needed to act on what we knew at that time. The information we had then said there was a food safety risk to consumers and we moved quickly to address it.”

At the same time, MPI commissioned a further array of tests to validate the initial results Fonterra reported. A total of 195 tests using a range of technologies have been conducted in laboratories here and in the USA. Results from the most definitive of these tests arrived over night, and were assessed with appropriate technical advice on hand today.

“We sought additional testing at both local and international laboratories, seeking the most robust results we could get. Scientists used a range of methods – all came back negative for Clostridium botulinum,” said Mr. Gallacher.

“MPI has today informed overseas regulators of these results, and we will be providing them with a full diagnostic report shortly. I will also be revoking my Director-General’s statement, issued under the Food and Animal Products Acts, about this issue.”

A failure of hygiene during processing remains a concern for customers incorporating WPC into their products. However, the concern primarily relates to quality and the potential for spoilage when used in foods that support growth of Clostridium sporogenes from spores.

The scare was a false alarm but it was a wake up call to not just Fonterra but everyone who depends on our reputation for high quality, safe food.

We can not afford to be complacent.

If we want to trade on our reputation we must ensure that it is matched by the highest possible standards in what we do and how we do it.


Delay for dairy at China ports

August 26, 2013

Another week, another problem with our food exports to China:

New Zealand dairy products ranging from milk powder to mozzarella cheese are being held on the wharves at Chinese ports as officials debate what form of additional testing should be applied following Fonterra Cooperative Group’s whey protein scare.

The Ministry of Primary Industries in Wellington confirmed to BusinessDesk late last week that exporters other than Fonterra are experiencing delays.

However, it appears the problem is not a blanket ban or evidence of anything more than the fact that authorities at each Chinese port are interpreting centrally issued orders to apply caution to dairy imports into China with additional caution. . .

Soundings in China by BusinessDesk suggest demand for Fonterra’s ingredients by Chinese food manufacturers and demand in supermarkets for New Zealand-sourced infant milk formula have been unaffected after a sharp, initial reaction when the issue was first revealed. . .

Trade officials are at pains to stress the issue reflects the fact that while China issues regulations from Beijing, these are interpreted autonomously by officials operating at each port. While delays to a wider range of New Zealand dairy products may persist for some time, they reflect caution rather than a punitive attitude, despite early Chinese media coverage deeply critical of Fonterra’s third Chinese food scare since 2008. . . .

There might be some politics and protectionism in the mix here but you can’t blame them for being cautious.

That caution reinforces the importance of the investigations being undertaken in the wake of Fonterra’s precautionary recall of products containing a small batch of whey protein concentrate.

They need to find answers to many questions about how the issue was handled which reassure customers and officials that our standards of food safety are as high as they can be.


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