Secrecy over milk DCD scare revealed

TRACY WATKINS
Last updated 05:00 14/04/2013

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Government officials sat on the DCD milk controversy for months while they held secret meetings with industry players and planned for "D-day" when the story finally broke.

Documents obtained by the Green Party show the Ministry for Primary Industries started working on a public relations strategy on October 30 - but the news did not break till January 24 when two leading fertiliser companies announced they had withdrawn dicyandiamide (DCD) from sale after it had been found in milk.

The documents add weight to complaints by independent dairy producers and others that the Government and Fonterra kept them in the dark for as long as possible.

Green MP Steffan Browning said the Government's focus should have been food safety, not its media strategy. Consumers had been let down and our international markets had also been hurt because the Government was not prepared for the DCD fallout, Browning said.

Even though the levels of DCD found were very low, the fact New Zealand milk had been tainted at all caused a furore in China and Taiwan and was given global prominence in the Wall Street Journal.

Minister for Primary Industries Nathan Guy said there was never any risk to food safety from DCD residues. "Had there been any food safety issue, then I'm sure an immediate announcement would have been made."

The MPI documents detail a series of meetings from October 30 and show the focus of officials was keeping the news secret for as long as possible. Even after the story broke, officials were telling industry players "don't hand [DCD test] results to regulators to avoid any market misinterpretation".

In the October 30 meeting, officials noted that the controversy was likely to affect other dairy producers, but said: "Initial work will be undertaken with Fonterra in first instance."

The documents detail the unfolding strategy over several months, and a focus on using the time until the story broke to put "risk mitigation" measures in place.

Even after the story broke officials were working to put a lid on it. One official noted: "Ideally we would like no media coverage."

But despite the months of careful planning, officials were taken aback by the "media frenzy" when the news became public, particularly in the sensitive Chinese market, where a previous milk contamination scandal had already posed a serious reputational risk to New Zealand's "100% Pure" brand. New Zealand trade and diplomatic representatives had to work round the clock after being caught on the hop because they were kept out of the loop, and social media in China exploded over fears for babies using New Zealand infant formula.

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In the papers, officials asked: "What would industry, media, commercial markets do with the information if it was detected?"

Despite that it was agreed that "until the meeting on 21 the issue will stay between the two parties [Fonterra and MPI] without involving other organisations."

On November 14, officials acknowledged 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".

But they continued to treat the matter as secret.

On December 4, officials ordered a "draft press release for the worse case scenario" and talked about a follow-up meeting the next day.

Throughout the meetings, officials and Fonterra reiterated that DCD was not a food safety issue.

But on December 5 there was an acknowledgment that the scare posed a "reputational NZ Inc issue" . . . "We sell to increasingly sensitive markets, some with a zero tolerance for unexpected substances . . . success for the working group is successful risk mitigation."

On December 20, officials canvassed various scenarios.

"Scenario one - [story] breaks over Christmas. React with prepared statements." Scenario two would kick in if the story hadn't broken by mid-January.

On January 22, the documents refer to officials discussing with Ravensdown "what parts of Ravensdown human health risk assessment Ravensdown is comfortable with publishing as part of its transparency".

Officials were also talking to government ministers about their preferred "D-Day and H-hour" for the story going public. They initially pencilled in Friday, January 25, as Aucklanders started heading off on a long weekend break for Auckland Anniversary Day. The story eventually broke January 24.

As late as January 31, MPI was still telling industry players that all communications should be co-ordinated through its officials "to ensure the issue is not made to look bigger than it is".

WHAT IS DCD?

DCD, short for dicyandiamide, is a chemical that was applied to grass on some New Zealand farms to mitigate greenhouse gas emissions from cows.

- Sunday Star Times

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