NZ milk powder stalled at Bangladesh border, officials scramble for detail

Bangladesh has become the latest country to halt imports of New Zealand milk powder, as it conducts tests for excessive levels of nitrates.

The hold-up comes after Sri Lanka last week lifted its ban on the sale of Fonterra Cooperative Group milk products that was imposed after local testing reportedly found dicyandiamide (DCD) in two batches of milk powder.

Reuters reported that customs authorities in Bangladesh halted imports of more than 600 tonnes of milk powder, mainly from Fonterra, pending tests. Bangladesh imported 20,741 tonnes of milk powder in the 12 months ended June 30.

"MPI is aware that there are some delays to New Zealand milk powder at the Bangladesh border," a spokesman for the Ministry for Primary Industries said in an emailed statement. The ministry "is working with authorities in Bangladesh as well as industry to understand the scale and scope of the delays and to get trade flowing again."

"As with all matters where there is potential contamination of product, the onus is on the exporting country to provide technical detail so that importing countries can make informed decisions about whether any controls are needed," he said. "The New Zealand government is providing this information to markets including Bangladesh."

Fonterra issued a statement saying it is working with the New Zealand government to assure Bangladesh authorities that the small quantity of product it exports to the country is safe.

Group director of communications Kerry Underhill says all Fonterra product, including that entering Bangladesh, is safe.

“Fonterra is working alongside the NZ Government to ensure that Bangladesh authorities have all the information that they need about the safety and quality of our products.”

Fonterra has been working to limit damage to its reputation after disclosing the existence of bacteria in some whey protein concentrate used in infant formula that could cause botulism. Chief executive Theo Spierings flew to China to provide reassurances and four separate reviews are now underway, with one from MPI expected to be released later today.

It also disclosed that dairy products were held up in China in May because of excessive nitrate levels.

The food scares have done little to dent global demand for dairy products. Fonterra this week lifted its farmgate milk price forecast for 2014 to $7.80 per kilogram of milk solids citing strong global prices, the second increase in as many months.

Units in the Fonterra Shareholders' Fund, which gives outside investors exposure to Fonterra's earnings stream, rose 0.4 percent to $6.90, and have slipped 2.3 percent this year.

Meanwhile, Fonterra has called on the Ministry of Primary Industries to release the results of its testing of Fonterra whey powder for botulism.

(BusinessDesk)