New DCD find adds to concerns for dairy trade

Traces of the agricultural chemical DCD have been found in Westland Milk Products' milk samples, likely to further spook New Zealand's international dairy customers unnerved by revelations Fonterra found DCD residues four months ago.

West Coast, South Island-based Westland said last night it was reassuring its overseas customers food safety and human health was not at risk. As a priority the company was doing further testing.

Chief executive Rod Quin said Westland had started testing for DCD or dicyandiamide, a chemical used in fertiliser to reduce nitrate leaching into waterways, after the Ministry of Primary Industries announced last Thursday the product had been removed from the market by fertiliser companies Ballance and Ravensdown.

The announcement also revealed Fonterra, New Zealand's biggest company and the world's leading dairy exporter, had found minute DCD traces when testing dairy products for DCD for the first time in September last year.

The product has been on the market for seven years.

Westland's tests had shown minute traces of DCD in some milk samples produced before November 1 last year, Quin said.

Evidence indicated milk after this date was clear from DCD.

Westland is one of New Zealand's biggest independent dairy companies, processing 85,000 tonnes of product a year.

Its second biggest market after New Zealand is China.

Fonterra and the Government are facing down a serious trade risk following last week's announcement as overseas customers, particularly in China where New Zealand dairy products have shot to 80 per cent of dairy imports after China's food safety scares, scramble for reassurance Kiwi products are safe.

Last week, the Government said research showed no food safety risk or human or animal health concerns with DCD use, and even with extremely high doses it has been difficult to identify any adverse effects.

Waikato Times enquiries have revealed that other dairy processors, including Westland, were kept in the dark for four months about Fonterra's discovery. Some have been fielding calls from alarmed overseas customers.

One exporter, which did not want to be named, said it was unhappy to learn only last Thursday, at the same time as the public, that Fonterra had found DCD residue in September.

Most sizeable independent companies, including Westland, belong to the Dairy Companies Association of New Zealand (DCANZ), which was part of a DCD "working group" formed by the ministry in December after Fonterra informed it in November of the discovery.

DCANZ chief executive Simon Tucker said association members were told of the DCD issue in a teleconference "about a week" before the public announcement. DCANZ chairman Malcolm Bailey, a Fonterra director, could not be contacted.

Dave Stanley, chief executive of Waikato's Dairy Goat Co-operative, a major dairy goat product exporter, said his organisation also did not learn of the DCD discovery until Thursday.

The co-operative had taken calls from overseas customers asking for clarification around food safety issues, he said.

Stanley understood the ministry had not contacted his company because it knew that no goat milk suppliers had used the chemical on farmland. But he said the company would have liked to have known about the issue.

Tatua chairman and DCANZ representative Steve Allen said his Waikato company did not learn of the DCD investigation until last Thursday, but said Tatua did not have an issue with this.

Allen said DCD residues appeared to be confined to milk powders, which Tatua does not make.

He said "90 per cent of things in the industry would not be heard about" by DCANZ members because they were Fonterra's business.

MPI believed only about 500 dairy farmers used DCD on pastures.

Asked why the ministry had not informed other New Zealand dairy industry exporters of the DCD issue earlier, it said when the decision was made by fertiliser companies Ravensdown and Ballance to voluntarily suspend sales of DCD treatments in January, the working group started a process of informing affected stakeholders, including dairy companies.

Deputy director-general Carol Barnao in a written response said it was important to do a full assessment of the situation and make a measured response, which was why the DCD working group was set up by the ministry early in December.