Fonterra container in Algerian drug bust

Last updated 11:21 31/10/2012

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A New Zealand shipping container, owned by dairy giant Fonterra, has been seized in Algeria after 165 kilograms of cocaine or heroin was allegedly discovered inside.

The massive drug cache was hidden inside the container, which was meant to hold powdered milk

The haul is one of the largest ever intercepted in the North African country, a security official told the Australian Associated Press.

A spokeswoman for New Zealand Customs said they were investigating the matter.

"Customs is aware of Algerian media reports that a significant quantity of an illegal drug - either cocaine or heroin - has been found in a shipment of milk powder in Algeria. Customs has not been able to verify these reports, and is working closely with Fonterra to establish the facts.''

Customs' Group Manager Trade and Marine, Paul Campbell, says that there is no evidence to suggest that any illegal substances were introduced into the container before it left New Zealand.

"Fonterra is a trusted trader and is part of Customs' Secure Export Scheme. Containers are sealed when they are packed, and the seal assures that the container has not been breached until it is loaded onto a ship."

Customs is aware that the cargo was unloaded and reloaded in Panama and Valencia, Spain.

"We have engaged our attache in Brussels and he will be working to establish the facts." said Paul Campbell.

"Customs has very high confidence in the integrity of New Zealand exports."

A spokesman for Fonterra said they were aware of reports from Algeria that a container loaded with milk powder was being investigated. "We're waiting to hear which Algerian authority is leading the investigation and we're on standby to provide any information as required.''

The powdered milk had been imported by ONIL, a nationally owned company that dominates the Algerian market, AAP earlier reported.

Algeria said last year that al Qaeda in the Islamic Maghreb, or AQIM, was reaping large profits from trade in cocaine, allowing them to firm up their presence in North Africa. The drug is distributed in Algeria but also exported to Europe.

The New Zealand Dairy Exporter Magazine reported that Algeria was one of Fonterra's largest country markets in Africa and the Middle East.

"...Its government [buy] milkpowder at the world market price to recombine and pack into plastic pouches, selling it to retailers at a fixed price as part of a food price support system.''

Fonterra has a branch office in Algeria.

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