August 3rd, 2013
A little comparison. Here’s an article a friend emailed me this morning. It doesn’t have a lot of information, but enough to know there’s more bad news coming. For example:
Fonterra is still refusing to disclose which of its eight customers were potentially affected by the contamination, saying it was up to them and their regulatory authorities to make those decisions.
Managing director of New Zealand milk products Gary Romano said the contamination occurred as a result of a dirty pipe at Fonterra’s Hautapu plant in Waikato.
“[After the contamination was detected] we went back immediately and isolated a very little used piece of pipework that was not as sanitary as it should be,” he said.
And note that seems to have been written by NZ Herald staff.
Then in the Herald I find this AP piece. It does that usual lazy journalism thing of tacking a bunch of random semi-relevant factoids at the end, but notice how much more information it contains. For example:
New Zealand authorities have triggered a global recall of up to 1,000 tons of dairy products across seven countries after dairy giant Fonterra announced tests had turned up a type of bacteria that could cause botulism.
New Zealand’s Ministry of Primary Industries said Saturday that the tainted products include infant formula, sports drinks, protein drinks and other beverages. It said countries affected beside New Zealand include China, Australia, Thailand, Malaysia, Vietnam and Saudi Arabia.
New Zealand’s Ministry for Primary Industries said Saturday that New Zealand company Nutricia had used some of the tainted product in its Karicare line of formula for infants aged over 6 months. Nutricia had locked down all five batches of infant formula it believed contained the tainted product, the ministry said. But it advised that parents should buy different Nutricia products or alternative brands until it verified the location of all tainted Nutricia products.
China’s product quality watchdog issued a statement urging importers of Fonterra dairy products to immediately start recalling the products.
The General Administration of Quality Supervision, Inspection and Quarantine also told quality agencies around China to step up inspections of milk products from New Zealand.
Romano said the problem was caused by unsterilized pipes at a Waikato factory. He said three batches of whey protein weighing about 42 tons were tainted in May 2012, adding that Fonterra has since cleaned the pipes.
Vague information refusing to reveal anything about who or what was affected vs. naming affected countries. Very little about what various agencies are doing vs. specific mention of AQSIQ, recalls, and stepped-up inspections. “…not as sanitary as it should be” vs. “unsterlised pipes”.
Refusal to name any Fonterra customer vs. Nutricia advising its customers what to do – and it seems to me like a very good response by Nutricia. Now, I don’t expect the NZ Herald to have the kind of global resources AP enjoys, but surely they could’ve wheedled a bit more information out of Fonterra and noticed what a NZ company making a brand as big as Karicare was doing?Update: Christopher Adams is on to it:
The affected product is Nutricia Karicare follow-on formula for children from 6 months old, the ministry said.
“Nutricia has advised that three of those [five] batches are in a warehouse in Auckland, one is on a ship, and the other is in storage in Australia,” said the ministry’s acting director general, Scott Gallacher. “Nutricia has advised it has locked down those batches, and they will not be sold on the market … MPI is still in the process of verifying this information, and today sent a team to Nutricia’s Auckland warehouses.”
Gallacher said that until the verification process was completed, parents should use Karicare formula for children 0-6 months or an alternative brand.
This morning I searched Baidu News for 恒天然 (Héngtiānrán, Fonterra’s Chinese name) and saw nothing relevant. I had another look a few minutes ago, and wow, what a difference half a day makes. Seven of the eight top results are this botulism contamination incident. I’ll run with the first article, on Netease, which is sourced from a paper whose English name is The Mirror. Clicking through to The Mirror‘s website, I notice this article is top of the page. Here’s what leaps out at me:
- The Mirror contacted the New Zealand embassy for comment. Not much comment was provided, because it’s a weekend, so more information needs to be gathered, but the comment I found to be constructive.
- AQSIQ also contacted the New Zealand embassy requiring action from New Zealand to sort this problem out.
- Three of Fonterra’s Chinese customers have received contaminated product, but it doesn’t name which three. Still, AQSIQ has required them to immediately recall the contaminated products.
I note Fonterra CEO Theo Spierings is on his way to China. I hope that suggests Fonterra has learned from the DCD scandal earlier this year. It will be interesting to see how this story unfolds.
Update: Just grabbed a dead tree copy of The Mirror from my local newsagent:
Yeah, I know, it’s a crap photo. But see that headline at the top? Blue rectangular background with big white characters? The vertical orange triangle with white characters at the left end says “新西兰” – New Zealand. The headline proper says “Botulinum found in milk powder”. I really hope Fonterra has learned its lessons.
August 2nd, 2013
I was first told some months ago to look into New Zealand meat exports to China as well as just dairy. And I have to admit that everytime I see a restaurant listing New Zealand lamb on its menu I do wonder, “Really?” Even more so when they’re advertising it. But it’s been one of those years when it seems as soon as I think I’ve got time and space, something more urgent comes up and drags me off elsewhere, and in any case, I’m not sure where to start looking.
But this Skykiwi post to Weibo grabbed my attention, especially with its
[Don’t understand China well enough]
So I followed the link to the fuller article on Skykiwi, headlined:
Meat tempest reflects lack of understanding of China. MPI to strengthen staff training
Trouble is, it references a TVNZ report, and both the Weibo post and the article include what would seem to be a screen grab of a graphic from a One News report, but for some reason I can’t persuade the TVNZ website to open. But this short APNZ piece at the Herald would seem to be relevant.
It’s about an MPI report into how two shipments of New Zealand meat were held up at port in China over problems with the paperwork. That One News graphic is interesting, listing:
- Failure to give adequate notice
- Own officials were confused
- Too “optimistic” problem could be solved
- Failed to advise bosses and Ministers
Now I’m trying and failing to find an article I’m sure I read this morning, or perhaps yesterday, reporting Labour politicians getting stuck into Minister for Primary Industries Nathan Guy over this issue. I recall it having some interesting statistics on the number of redundancies at the MPI this year and how many vacancies MPI still has. If we go back to that APNZ piece linked above, we can see what I’m looking for here:
The Labour Party is calling on the Government to boost resources at the industry after a review that found systematic failings left millions of dollars worth of New Zealand beef and lamb sitting on Chinese docks for weeks.
Labour’s primary industries spokesman Damien O’Connor said there had been 90 redundancies at the ministry since January last year and there are 48 vacancies in the compliance area.
Except I’m sure I read an article going into more detail on this.
Anyway, it would seem there’s a lot of work to be done sorting out MPI to give our exporters a decent shot of actually getting their products into China.
And then there’s this:
Gallacher承认，MPI对中国的认识有所不足。过去5年，新西兰对华贸易额大幅增加。对新西兰而言，中国市场的规模和重要性都在增加。“但这也是 一个我们亟需了解的市场。”Gallacher说，这次检讨发现，MPI需要进一步加强与中方合作。同时，也需要改善内部资源、文化、系统和流程，避免类 似的问题再次发生。
It would be nice to see how TVNZ reported it in English, but oh well, here goes:
Gallacher acknowledged MPI didn’t know China well enough. In the past 5 years New Zealand’s trade with China had increased considerably. For New Zealand, both the scale and importance of the China market were growing. “But this is a market we urgently need to understand.” Gallacher said this inquiry showed MPI needs to further strengthen its cooperation with China. It also needs to improve its internal resources, culture, systems and processes to avoid similar problems occuring again.
And that is a refreshing bit of honesty. Now let’s just hope somebody manages to persuade the government that one can cut budgets too far, that the bureaucracy needs resources in order to function properly, and that much as we may all love to loathe bureaucrats and bureaucracy, when properly resourced, the bureaucracy makes a very real, very valuable contribution to the economy. This issue of New Zealand meat exports to China would seem to be a very good example of how.
August 1st, 2013
Right, now that I have a functioning internet connection again, here’s what I wrote yesterday afternoon, although having to save most of it in another format did a few funny things with the formatting. Anyways, here it is:
Note: Updated below. It has been brought to my attention that comments in the article about Péizhī’s address are a bit overwrought, to say the least. I’ve also strengthened a bit of commentary on the tone of that article. See below.
Come on, New Zealand, when the Herad’s Christopher Adams writes:
New Zealand’s lucrative reputation for high-quality dairy produce continues to get a battering from the Chinese media, despite efforts by this country’s government to reassure consumers in the world’s second-biggest economy that Kiwi milk products are safe.
He’s not making stuff up. It’s not just coming out of thin air or the product of a fevered imagination. Although relying on China Daily doesn’t really cut it. That rag is published in English for a non-Chinese audience, really little more than a public diplomacy effort, just trying to push the official Chinese point of view. But still, looking at media published in Chinese for a
Chinese audience, yes, Adams is right. For example:
92 tons of imported milk powder recalled
And yes, that’s a general “substandard imported goods” story, but New Zealand certainly gets a dishonourable mention:
The list of substandard food products shows three batches of imported milk powder with excess nitrites, including 50 tons of skim milk powder imported from France by Suzhou’s Jiahe Food Industry Company Limited, 28 tons of full cream milk powder imported from New Zealand by Shanghai’s Lianghao Property Development Company Limited and 14 tons of full cream milk powder imported from New Zealand by Shanghai’s Yinglian Food and Drink Company Limited.
Alright, not much detail, and a lot of other countries are mentioned too, but this has been going on for a long time now and one would think NZ’s dairy exporters would have learned. But this article on the People’s Daily website, but attributed to Cao Ping of Qianlong Green Beijing, is a whole different storyl, focussing on New Zealand and going into a lot more detail:
June 22nd, 2013
I found two interesting little articles in my inbox today. One had some interesting statistics on imports of New Zealand milk powder into China. The other makes the kind of claim that makes you do a classic Hollywood double take and eye bugging.
First the statistics. This article has only three short paragraphs, the second of which is yet another rehash of the basic types of Made in NZ infant formula. But the first has some interesting statistics. According to Shanghai customs, 114 thousand tons of New Zealand milk powder were imported in 2012 (presumably only into Shanghai), an increase of 85.2%. An increase of 85.2% over the previous year? I assume so. From January to May 2013 85 thousand tons of milk powder had been imported, an increase of 81.5% – again the same assumptions of “into Shanghai” and “over the previous year”. Chinese dairy industry expert Wang Dingmian – who seems to be the Chinese media’s go to person for such things – said 75% of milk powder imported into China came from New Zealand.
Then in an intriguing third paragraph, Wang explains that you can tell a lot about which particular model of formula production has been used by studying the labelling. The barcode, for example, can tell you where the product was made. If the barcode prefix is in the 690 – 695 range, it was made in China. 76 is Switzerland, and 93 are both Australia and New Zealand. I guess now I’m going to have to learn how to read barcode numbers, because looking at a few around me I’m not sure what the prefix is. A packet of milk candy next to me has a 6 to the left, and then just inside the two long lines at the left end of the code, 93. Do I put those together to get a 693 prefix saying “made in China”? And looking at a couple of books beside me, the barcode numbers seem to be identical to the ISBN, so is all this industry specific? And then it says consumers with any suspicions can ask vendors to provide evidence of import and inspection – but as Mr Ji found out researching Oravida, many of the formula brands are already putting various kinds of evidence on their websites, so a quick Google or Baidu should suffice.
This article ends with the odd, lonely, little sentence stating the reporter learned that many Shanghai dairy companies use New Zealand milk. How that comes as a surprise when until recently Shanghai’s own Bright owned a majority stake in Synlait, and still has a fairly hefty stake in Synlait, I don’t know, but never mind.
The next article reports that starting June 20 all infant formula exported from New Zealand to China would have to be registered with the Ministry of Primary Industries. This isn’t really news. Christopher Adams of the NZ Herald reported it last Saturday, for example:
Until now, the ministry hasn’t been able to say how many brands are being exported to China. However this week it announced that from June 20, contract manufacturers will have to register with the department information about the brands they produce.
But here’s the sentence that had me up for an Oscar for Best Eye Bugging Double Take:
The source of some milk powder is not New Zealand, rather it is milk produced in China and exported then shipped back and labelled.
Wow. Just wow. There have already been a few caught selling “made in NZ” powder that wasn’t, but going to these lengths? I guess that’d get them documentation from Customs and AQSIQ to say the milk powder was in fact imported.
This article also reports that China’s Ministry of Industry and Information Technology held a conference with 127 infant formula companies and plans to soon put out a policy to ban the registration overseas but manufacture in China Western infant formula trade and expand the scope of its management of imported milk powder.
June 15th, 2013
I’m still here. Don’t worry. Just been a bit busy, is all. Also, the NZHerald suddenly paying a lot more attention to China and particularly NZ-China trade has taken a bit of steam out of me… but that’s a good thing, because it means good writers publishing useful information in places people will actually read it. Fran O’Sullivan and Christopher Adams, in particular, at the Herald have impressed me, with this piece by Adams a good example of why.
I like that article because it’s clear Adams has been keeping an eye on this issue for some time, is getting good information, and understands the issues – including why some in China may be casting doubt on the claims many companies make regarding their “NZ made” formula. It’s a rather long quote, but here’s a great example:
The opaque nature of some firms involved in New Zealand’s baby milk trade became evident when the Weekend Herald tried to track down a company named in one of the CCTV news stories.
When a CCTV journalist showed up at the address, however, it turned out to be an auto repair shop on Great South Rd and staff at the business had never heard of the company supposedly involved in formula trade.
The Weekend Herald spent two afternoons combing the streets of east Auckland trying to track down the directors of the company, using details filed with the New Zealand Companies Office.
The Pakuranga address listed for one of the directors turned out to be non-existent.
The following day the firm’s accountant changed the details to another house on the same street, saying the previous address had been the result of a “typing error”.
A woman at the second address said the director – who had an entirely different address listed on the shareholder information page of the Companies Office website – didn’t live there.
Another shareholder is registered as living in an apartment block on Karangahape Rd, but the manager says no one of that name lives, or has recently lived, in the building.
Oh, and wait:
The People’s Daily newspaper reported that CCTV also sent a can of New Bay Bay for testing by the Government import authority in China, which found the product had selenium levels below Chinese standards.
New Bay Bay is apparently produced by Sutton Group. Sutton Group products failed inspection at least twice last year. How many times do they need to fail inspection before they learn?
But the comments of Westland Milk Products’ Rod Quin I find particularly interesting. He also “gets it”:
some serious issues need fixing, not least contract manufactured brands passing themselves off in China as “reputable New Zealand dairy processors”.
“We’ve traded on a safe and secure supply chain and high quality dairy products for many years and these guys chasing short-term opportunity put a lot of that at risk,” says Quin.
And his comments on the relative merits of dry blending versus wet blending are also solid food for thought – and suggest the solid professionalism of a former boss of mine, also a Coaster – do it properly the first time or just don’t do it.
Anyway, it’s just good to see people who Get It, in the media, the industry and even government, and it’s good to see the message getting out and getting listened to.
But what to do, especially in light of the possible political motivations behind certain events in China recently targetting NZ products, as discussed in Adams’ article?
Well, first of all, clean the industry up. And yes, a fairly large part of the issue needs to be dealt with by the Hong Kong and Mainland Chinese authorities. New Zealand’s authorities (MPI, Customs, whoever) can’t do a thing once the product is on a ship out in international waters. But there is a lot that NZ can do to clean up within its own shores. Like, for example, how is it that a company exporting large amounts of anything be registered to an address it has no connection to beyond the claim it made in its Companies Office registration? Can nobody in the Companies Office make a simple phone call, stop by the address claimed, or even just zoom in on Google Maps and hit Street View (?! yeah, really, try it some time… It’s pretty amazing to see the registered address of a company exporting large volumes of product looking for all the world like a suburban townhouse or some completely different company’s headquarters)? And what of these contract manufacturers? How much do they know, or bother to find out about, the brands they manufacture for? How much should they be required to know? And how is it that Sutton Group products fail inspection so often?!
Secondly, engage the Chinese consumer… and in that respect, this post by KEA on Weibo was interesting. The NZ Pure Shop has opened on Tmall to sell 100% pure NZ produce to Chinese consumers. Wait… I can buy Weetbix?! Apparently not… 2 litres of Oravida milk (not a brand that I remember, but an intersting apparent blend of Maori and Romance words for life, and it’s not like I’ve lived in NZ for… umm… a long time…) going for 128 yuan (around NZ$23! Strikes me as being rather steep, but then again, haven’t lived in NZ for… ). But my big question is “Who’s behind this?” Well, if they could get Trade Minister Tim Groser to officially open the store, it must be somebody fairly respectable, surely. But I’m struggling to find out who. None of the links I follow seem to offer any enlightenment. Nelson mayor Aldo Miccio apparently opened a NZ Inc Shop on Tmall, but I remember searching Tmall for it at the time and finding nothing. Still can’t. Whatever, I can certainly see plenty of room for greater clarity on who’s behind this NZ Pure Shop and how much we can trust them.
April 24th, 2013
So what to make of this? I see posts like this on Weibo reporting that a bar in Hamilton charged ethnic Chinese a NZ$10 cover charge, while charging white patrons only $5, with a link to Sky Kiwi’s full article here. A little poking around, and here’s the original Stuff article in English. The bar owner says that cover charges vary according to, among other things, state of dress – shabbily dressed punters are charged more, apparently. But, from the Stuff article:
The group of New Zealand-born Chinese are shown on Facebook that night wearing button-up collared shirts. But at the door, they were charged $10 to enter Bar101 while their white friend was charged $5.
“I’m not 100 per cent sure if it was [racial discrimination], but it feels like it,” Kingsley Sam said.
And he doesn’t look like a slob in the photo, either. Of course, the bar owner protests that it couldn’t possibly be racism:
“There’s certainly no desire to keep out one particular race. I mean, to be fair, if you did that in Hamilton with such a diverse culture as we have, you’d go out of business because we’ve got such a mixed-race society now.”
Well, I’d really like to believe that’s true…. But what he’s reported as saying about his bar’s policy seems so confusing, I really have to wonder how it is enforced, or could be fairly enforced, especially in light of the comments on denying undesirables entry and cover charges from a business rival.
I dunno, it might be a total non-story, but it doesn’t look good. Perhaps considering our Prime Minister has just toured China trying to drum up business and came back talking up the numbers of Chinese tourists NZ-bound, NZ business owners might do well to remember that whatever goes on in NZ is reported in China – sometimes, given how active the likes of Sky Kiwi are on Weibo, even quicker than it’s reported in NZ.
…and there’s an infant formula story bubbling away that I really need time to look into… hopefully I can get these exams marked and out of the way this afternoon…
March 27th, 2013
There’ve been a few stories I’ve been following recently, but I’ve generally lacked either the time or the energy, or both. This one from Monday is one of them, but I can’t help but think it needs a new headline. “NZ wine: Late to the party” would seem more appropriate to me. Why? Check out the headline and especially the date on this article. Yep, zero tariff, 13 months and 4 days ago. And the very first clause:
From January 1 this year [2012, now last year], China will impose zero tariffs on imported New Zealand wine
Now, it’s entirely possible that I’m being unfair on NZ’s winemakers. After all, that qq article linked above does quote one Tim (the Tim Lightbourne pictured and quoted in the Herald?) of Invivo, the company that seems to be at the centre of Christopher Adams’ Herald article, as saying that where once the US and Europe were their big export markets, China is now their focus. But – well, I was going to upload a photo of what my students told me they thought of when the heard the word “New Zealand” (or, of course, “新西兰”), but it’s too big and I can’t figure out how to scale it down to an appropriate size. Let’s just say, the words that “New Zealand” brings to mind were:
milk, milk powder, grass, sheep, cows, clean air, water, blue sky, mountains, the Inner Mongolia of the South Pacific
Ok, “Inner Mongolia of the South Pacific” was my interpretation of something that was said in Chinese, words to the effect of, “Wow, it’s like we’re describing Inner Mongolia”, but the rest of the words were theirs. Notice which words don’t appear? That’s right,
wine, fruit (especially kiwifruit), tourism, education, films (especially anything by or involving Peter Jackson)
Now, I have ranted about the unavailability and expense of NZ wine in the past, only to be told it’s easily available in Shenzhen, but that was a long time ago and I’m not sure where I posted that rant. I’m also sure that, given the apparent Shanghai focus of NZ’s business community (judging by emails from KEA), that NZ wine is more easily available in Shanghai than in Beijing.
But here’s what I see: I see plenty of dairy companies sourcing their milk powder from New Zealand or wishing to create the impression that’s where they source their product playing up the 100% pure, clean, green, pollution-free NZ angle; I see Air New Zealand placing ads featuring photos of absolutely stunning scenery in local newspapers (bottom left quarter of the page, you may need to squint, but it definitely has the phrases ‘100% Middle Earth’ and ‘100% New Zealand’ in the top left of the ad and a koru and ‘新西兰航空’ (Air New Zealand) in the top right); I see Zespri (who’ve found themselves in their own spot of bother lately – and the only quibble I have with that article is that Fran O’Sullivan doesn’t elaborate on the lessons Zespri and NZ exporters to China gernerally have to learn from Zespri’s experience) getting their kiwifruit prominent displays in the fruit and veg sections of supermarkets, I see Anchor butter served up with the bread at banquets in the Great Hall of the People (only wangled that 3 times so far… ), I see NZ lamb on the menus of restaurants pitching at an affluent, sophisticated, or at least aspiring market (though information I have recently heard suggests that if that is genuine, it may well be grey market… no time to chase that up so far, but I’ll be looking into it) and I see the imported wine sections of supermarkets either big enough or specialised enough to bother with such things chock full of wine from all the major wine-producing countries, old world and new – France, Spain, Italy, Portugal, the US (California at least), Chile, Argentina, South Africa, Australia – everybody but New Zealand.
What I very rarely see is New Zealand wine on supermarket shelves, and when I see it it is absurdly expensive – though I must admit I haven’t seen any since the tariff was cut to zero.
What I never see is any attempt to promote New Zealand wine. Alright, fine, that may be because I’m in Beijing and not Shanghai or Shenzhen or wherever. But for crying out loud, free trade agreement, zero tariffs, and a reputation for clean, green, pollution-free produce still miraculously intact despite the missteps of our major producers and an ever-growing market for wine. Why isn’t the NZ wine industry challenging “Chateau Changyu”‘s ads playing up faux-European sophistication with a “Yeah, right, but we’re guaranteed quality and clean“?
To be fair, I am working off pure anecdata here, nothing to pass peer review, and it certainly seems from the evidence I have to hand that Invivo, at least, “gets it” and is working at building up its market here. But “Brand New Zealand” or “New Zealand Inc” wine division? MIA so far as I can tell.
February 3rd, 2013
No, DCD milk is not out of the news yet, but it may be calming down – certainly didn’t see anything new about it today, just a few more rehashes of old stuff. Maybe Fonterra’s really lucky. We’ll see.
But it’s not all bad news. This article is so short I might as well just translate the whole thing:
New Zealand exports of dairy cows to China account for over 80% of exports
据新华社讯 2012年中国对新西兰进口奶牛需求大幅增长。据新西兰统计局日前公布的数据，2012年前11个 月，新西兰共出口38232头奶牛至中国，出口额高达1亿新西兰元（约合5.2亿元人民币），而2011年同期，新西兰出口至中国24924头奶牛，出口 额6320万新西兰元（约合3.3亿元人民币）。
Xinhua reports that in 2012 Chinese demand for imported New Zealand cows increased dramatically. According to statistics released by Statistics New Zealand the day before yesterday [note: January 31; the article is dated February 2], in the first 11 months of 2012 New Zealand exported a total of 3823 dairy cows to China with an export value of 100 million New Zealand dollars (around 520 million RMB), while in the same period in 2011, New Zealand exported 24934 dairy cows to China, with a value of 63.2 million New Zealand dollars (around 330 million RMB).
The statistics show that in the first 11 months of last year, New Zealand exported a total of 43517 dairy cows with a total export value of 112 million New Zealand dollars (around 587 million RMB), and China is New Zealand’s biggest dairy cow export market, taking 88% of its exports.
And that’s it. Ok, so that’s bad news from an animal welfare point of view if you’re the Green Party. I’m not sure it’s good news for China’s environment, given how much water dairy cows need and how much waste they produce. But China’s obviously very keen to improve the quality of its dairy herd, and that’s a lot of money finding its way to New Zealand.
But exporting live cows does seem a rather short term strategy to me. Surely at some point China will have enough to both boost the quality and amount of milk production and breed its own top quality dairy cows, and if China is producing its own top quality milk, surely demand for New Zealand-produced infant formula will gradually drop – assuming China’s dairy companies manage to regain the trust of Chinese parents, of course. Still, Fonterra mishandling food safety scares could help with that.
And then I found this odd little article headlined:
And I thought, huh? Some New Zealand products successfully built in China for the first time? Which products? And how would this make sense even if I knew which products?
But reading the article, it became clear that this 新西兰部分产品/”some New Zealand products” is actually the name of a company or organisation. A strange name for a company or organisation, but it must be a name, because a proportion of products from any country doesn’t generally announce things – companies, organisations and people do. So a bit of googling, and it took a while, but I suspect this 新西兰部分产品 might be Fonterra. Why?
恒天然 is the usual Chinese name for Fonterra. It’s got that 部分产品, but the context suggests that’s part of the company name rather than “some of Fonterra’s products”. 魏柯文, greater China director of this mysterious company, is the same name as given in the first article (although the first article doesn’t give a title or job description), and a little more poking around found me this Caijing article from December in which “恒天然大中华区和印度区总裁” – Fonterra Greater China Region and India Region director 魏柯文(Kelvin Wickham) is interviewed.
So how did Fonterra become 新西兰部分产品? Sure, their New Zealand products count as some New Zealand products. But 新西兰部分产品 is a really strange and misleading name for a company. But they seem to be sticking with their old Chinese name 恒天然 on their website, so I doubt this is some weird and ill-advised attempt to dodge the DCD flak. So if that article and that post are reporting Fonterra’s deeds in Hebei, then it would seem we have quite a spectacular case of ‘lost in translation’. Either that or a company in the same line of work with a boss with the same Chinese name as Fonterra’s China and India boss is also building massive dairy farms in Hebei, but made a spectacularly poor choice of Chinese name. Nah, I think lost in translation is more likely.
I wonder if somewhere out there there’s an article headlined “新西兰恒天然公司部分产品首个在华牧场顺利建成” and through a process of careless copying and pasting, the all-important 恒天然公司, the actual name of the company, got dropped out and Fonterra was renamed. Google doesn’t seem to think so. Maybe it’s a copyediting problem. Either way, it leaves me wondering how trustworthy the figures reporting what strikes me as being pretty huge scale dairy farm construction in Hebei’s Yutian county. It’s not the first article I’ve seen reporting farm construction on such a scale, but if they can make such a glaring error in the name of the company, who knows what else they’ve done.
Still, Caijing did report in December last year that Fonterra plans to have 30 farms in China by 2020, and that China is now Fonterra’s largest export market, taking 16-17% of Fonterra’s New Zealand-made products and accounting for 12-15% of its sales. So maybe there is some truth to the huge numbers reported for their farms in Hebei. Who knows.
February 2nd, 2013
Hey, MPI, Fonterra, what are you doing? Whatever it is, it certainly does not seem to be enough.
Why? Take this as an example. The headline reads:
DCD discovered in New Zealand milk powder. Expert says amount small, no danger to health
Seems alright, right? Yeah, until you read the article. The opening sentence is a brief recap of the situation, but ends by stating Fonterra “kept it secret” for more than three months – and yes, with scare quotes. Why scare quotes? I’m not sure, but it does seem to draw attention to the “kept it secret”. But I suppose there is a difference between an active hush-up and simply neglecting to inform anybody. But which was it? I don’t know, but I’d agree that the length of time between the discovery of DCD in some dairy products and the revelation of that discovery to the public certainly looks suspicious.
The next paragraph interests me because of a certain choice of word:
According to reports, the DCD in New Zealand milk powder came from soil pollution. Some farms in New Zealand sprayed their pastures with fertiliser containing DCD, and after cows ate the grass, the milk they produced was polluted. Although the New Zealand government has responded, saying that only a few milk powders were contaminated with DCD, and it poses absolutely no threat to food safety, because New Zealand is the world’s biggest dairy exporting country, this issue has caused many countries to be worried.
See that word ‘污染’ – pollution or to pollute – used in each of the first two sentences, first as a noun – soil pollution – and then as a verb – milk they produced was polluted. And what really big issue plagued China through the first month of 2013? A severe air pollution crisis. What has been a major theme in the marketing of New Zealand dairy products in China? That’s right, clean, green, 100% pure, pollution free. Uh oh, New Zealand is no longer pollution free. There’s pollution in the soil and milk.
I also find the last sentence interesting in how it ends with “world’s biggest dairy exporting country” and “many countries worried”. It certainly seems to me to emphasise that MPI’s assurances that only a few products were contaminated with amounts of DCD so tiny that nobody’s health was ever at risk are simply not good enough. You’ve told us this, but hey, this is a big deal and we’re still worried.
The next paragraph is mostly the same statistics that have been endlessly repeated in every article on the subject, except that it starts by claiming that 95% of New Zealand’s dairy produce is exported. Really? My impression was it was closer to 80%, but whatever, either way it’s a huge amount.
The reporter then talks to a professor at China Agricultural University and member of the China Dairy Industry Association Nan Qingxian, who looks at the claims of how much DCD-contaminated milk or milk powder a 60kg adult would have to consume to put their health at risk (and I’m sure I’m not the first to think, fine, but we’re talking about products for infants here), and says:
At present the biggest problem is that there is absolutely no international standard for the testing of DCD, there’s only a few countries like the USA who have put DCD on the list of things that must be tested for in food products, which means it’s already treated as a dangerous product, and China should do the same as soon as possible.
So – so what? It’s still a toxin. Nan also points out that the raw material of DCD is… wait for it…
Ah, melamine. The grandmother of all dairy product safety scandals.
And when asked if a similar problem could occur in China, Nan says there’s no need to worry, because most Chinese pasture is still in its original state and fertiliser is not generally used, and in any case, not all fertiliser contains DCD.
So, to sum up, a nice looking headline, but New Zealand milk – polluted. Chinese milk – safe.
And that’s not all I’ve found in the news today. I wonder what Fonterra thinks of this headline:
Babymill: Not all top quality milk powder comes from New Zealand
I hope Fonterra finds that reassuring – don’t worry, New Zealand has competition, there are other sources of milk out there.
And, oh boy, does this reek of puff piece, but it’s highlighting another source of quality milk for those worried about the safety of New Zealand produce. The Netherlands. It starts off trying to explain how the fact a quarter of its land is below sea level and so much of its pasture has been reclaimed from the sea makes the Netherlands’ pasture extremely good. I don’t get it, but whatever, there might be some truth to that. Then it explains that infant formula production is done under the regulations for producing medicine, and so formula is tested much more often through the production process than formula in other countries, and it meets the EU’s tough quality standards. It then says that electricity is the main power source, and wind the main source of Dutch electricity, so the Netherlands’ air quality is good. Of course, it doesn’t mention that the Netherlands is downstream of neighbouring Germany, and not terribly far from the heavy industrial Ruhr, but nevermind. It goes on to point out that the Netherlands is one of the few countries to be free of all common communicable cattle diseases.
So, if we trust People’s Daily, next time we hear clean and green or 100% pure, we’re supposed to think of windmills, tulips, polders and canals, it seems. I wonder if Fonterra has any plans to fly Chinese journalists to New Zealand, take them on tours of the dairy farms and factories of the Waikato talking about how clean and safe the milk powder production process is, then stand them on the beach at Raglan and politely suggest that while the Netherlands has heavy industry very close to its dairy farms, it’s a hell of a long way from New Zealand to anywhere else. Just don’t let them see the state of New Zealand’s lowland waterways.
On my way to lunch I bought a copy of Beijing Youth Daily, and on the front page was this rather short article.
If imported dairy products have safety problems importers should voluntarily recall products
AQSIQ has issued a new regulation, to come into effect on May 1 this year, stating that the importer should voluntarily recall imported dairy products with safety issues, whether they’ve already harmed people’s health or could pose a risk to their health. Also, it bans dairy farmers exporting to China from using feed, feed additives, veterinary medicines and other chemicals harmful to animal or human health banned in either China or the exporting country or territory. Also, AQSIQ will be able to issue warnings and notices of threats to dairy product safety and take conditional measures, such as increasing the strictness of testing and ordering recalls.
Which looks good, but I still can’t see what Fonterra is doing to persuade China that the DCD contamination really was so minor and is all fixed and its products really are safe. Instead, I search the New Zealand Herald and find an article from Wednesday reporting that Westland Milk Products found traces of DCD in some of its products produced before November 1.
The tests revealed minute traces of DCD in samples of Westland products produced before November 1 last year. The evidence indicated products made after that date are free from DCD, the company said.
Westland is conducting further testing in line with customer and government requirements and said it would announce the results as soon as possible.
Fine, but I would like to know when the testing was done and how soon after DCD was found in Fonterra products Westland found out. Westland’s website looks pretty, but doesn’t seem to work too well, and searching it for “DCD” didn’t turn up much of anything.
And news from yesterday that DCD runoff may be damaging aquatic environments:
A University of Otago study has found dicyandiamide (DCD) residues in streams in Otago’s lower Taieri Plain in concentrations that cause natural nitrogen transformation processes to be disrupted in aquatic ecosystems.
Department of zoology researcher Marc Schallenberg conducted laboratory experiments showing that in a wetland system, the presence of DCD inhibits the processes of nitrification and denitrification – two natural processes that help to purify and detoxify waters.
“While DCD’s inhibition of nitrification on land is desirable as it reduces the amount of nitrate entering streams, its similar inhibitory effects within aquatic environments is undesirable, as this could lead to ammonia toxicity in fish and other species, or increased incidences of algal blooms,” Dr Schallenberg said.
And that, sadly, is about all the detail the article gives. The rest is either introduction or more mindless repitition of what we already know.
I guess its good for New Zealand’s river systems that DCD has been withdrawn, even though it was used to prevent nitrate leaching into the rivers, but I wonder how long the contamination will persist. I guess rivers, being flowing things, will gradually flush the DCD out, but how long will it take all of the DCD to leach out of the soil and be washed out into the sea?
But here, at least, is some common sense from the Tourism NZ chief executive:
Tourism NZ chief executive Kevin Bowler said New Zealand had to be very careful about its reputation.
“We need to follow up really good practices around protecting our environment because it’s such an important part of why visitors choose to come here. Obviously none of those stories are particularly helpful to us,” he said while commenting on figures which showed a dip in the number of overseas tourists during the past year.
Yes, absolutely. Because people are let down by the difference between the hype and the reality. I’ve probably told this story a gazillion times, but whatever, years ago I met two Belgian friends of a friend and showed them around Wellington for a couple of days. They told me, “You know, the way you Kiwis treat the environment, if you had the population density of Belgium, your country would be a toxic waste dump”. And they were right. And so was Fred Dagg – we don’t know how lucky we are. It really is the lack of people that keeps New Zealand as clean and green as it is, and as New Zealand’s population continues to grow, if we want our kids and grandkids to run around on beaches and in parks barefoot like we used to do (probably still do, many of us – when she got back from her first trip to New Zealand my wife told all her friends and family about me wandering around with no shoes on) then we really need to improve the way we treat our environment. And if we want to keep our tourism industry and our food exports, we need to treat our environment better, because tourists going home and telling their friends and family that that 1oo% pure thing is a load of nonsense and food safety scandals really does make people think twice about visiting New Zealand or buying our produce.
So, Fonterra, where are you? What are you doing to persuade your formerly devoted Chinese customers that your products are pure and safe? Why am I not seeing any evidence that these efforts of yours are working?
January 31st, 2013
Nope, this scandal isn’t just going away, and I really hope Fonterra and MPI are paying attention, because so far they don’t seem to have handled things terribly well.
What do I find on Hexun today? A suggestion that perhaps Chinese dairy companies might be rethinking their plans to build milk powder plants in New Zealand, and more on the drop in sales, especially online, of New Zealand made infant formula. Although I also note that both articles also have an ad for imported infant formula, including New Zealand’s Karicare, at the bottom.
Let’s start with the second one first. It’s a repost of a Beijing Daily article. The reporter went to several large supermarkets around Beijing and saw that New Zealand made infant formula was on the shelves in its usual prominent space and apparently selling as normal. Online, however, it’s a different story, with New Zealand infant formula purchasing agents on Taobao having lost half their business and many parents saying they were not giving their children New Zealand infant formula for the time being. The figures given for the drop in sales on Taobao are 50.9% over the last 7 days and 61% compared to the same period last year. A purchasing agent specialising in imported infant formula said that sales had dropped by half and many buyers were now buying North American, Japanese or Dutch made infant formula.
The reporter visited large supermarkets like Carrefour, Walmart and Hualian and saw New Zealand made infant formula on sale as per usual. When asked, the person in charge at one Carrefour told the reporter:
Up till now the supermarket still hasn’t received any notice to take it off the shelves.
The reporter then visited high-end supermarkets like Cuiwei and Modern Plaza and found the same situation. A sales assistant told the reporter:
Lately fewer people have come to buy, but we haven’t received any notice to take products off the shelves or recall them.
To me it’s almost as if the reporter was expecting to find New Zealand infant formula off the shelves or hidden away or supermarkets ordered to stop selling it, and is surprised to see it still there as per normal. I was just in one of my local supermarkets, and I saw nothing unusual about the infant formula display, but I didn’t see any prominent mentions of New Zealand, either.
And now the first one second. This one comes from The Beijing News, and in the paper edition is a full page with an interesting image at the top – two Friesian dairy cows with targets on them and “二聚氰胺” (DCD) repeated in various sizes in the background.
I’m not sure about this word “躺枪” in the headline and later in the text, but Baidu Baike seems to think it comes from a line in a Stephen Chow film and means to be attacked even though one is innocent or just a bystander. “Collateral damage”, then? I’ll run with “collateral damage”. That would make the headline:
Domestic enterprises building plants in New Zealand “collateral damage”
Seems to work.
Anyway, a fair bit of it is repetition of stuff reported elsewhere over the last few days, as has become frustratingly common in modern journalism. But there’s some interesting stuff, too. For example:
Right when domestic consumers were seeing New Zealand as the “Pure Land” of milk production, the crisis broke out.
Tempted to write “Land of Milk and Honey” for “Pure Land”, as that would seem to be pretty close to the intended meaning (especially when look at the prices manuka honey is going for on Taobao and the likes….. no, don’t jinx NZ, we don’t need a contaminated honey crisis, too).
This news unexpectedly made Yili and Yashili, who had only recently announced they would build plants in New Zealand, “collateral damage”. On the day [the day the news broke], Yashili’s share price plummeted. And industry insiders said the DCD incident could well influence domestic enterprises plans to build plants in New Zealand.
On this, Yili chose silence. Yashili said that its plans to build a plant in New Zealand would not be affected by this incident.
Although I think New Zealand has far too many of its economic eggs in the dairy export basket, it would be disappointing to see Yashili and Yili choose to build their plants elsewhere. Why? They were each planning to invest 1.1 billion yuan in these plants, with Yashili building in Waikato and Yili in South Canterbury. That’s money, jobs, and not helping further concentrate all of New Zealand into Auckland. Not that there’s anything wrong with Auckland (apart from its woefully inadequate public transport, of course), but the rest of the country needs some love, too. And I don’t see the sense, given New Zealand’s geological wobbles, of concentrating everything in one city – in Auckland’s case, in one city built on a volcanic field that will one day erupt again. Spreading things out so that one natural disaster (well, one smaller than a possible future eruption of Lake Taupo, at least) doesn’t wipe the entire country out seems to make much more sense than me. So, sure, Yili and Yashili’s investments, if they win the necessary approvals and aren’t scared off by the DCD and go ahead, will help cement New Zealand’s reliance on dairy exports, but at least they’re giving the provinces some much needed love.
There were media reports on January 28 that Mengniu recently spent a large sum of money buying in 3000 head of pure Holstein dairy cows in the hope of improving the quality of its milk.
Cos we can’t trust those Kiwis to not go spraying chemicals on their grass, but we can buy their cows. Right? Fair enough, under the circumstances.
Apart from public perception and cost, building a plant in New Zealand has tax benefits. Yili says that China and New Zealand have already signed a Free Trade Agreement, and in 2020 import tariffs on dairy products will be cut to zero, increasing the company’s profitability and having a positive effect on strengthing the company’s competitiveness.
So let’s settle this DCD issue and get things back on an even keel, because if Chinese dairy companies have such strong reasons to invest in New Zealand, and by doing so they can create jobs and break Fonterra’s stranglehold, then surely everybody but Fonterra wins? And, personally, I’d be quite happy to see Fonterra taken down a peg or two, so bring it on.
Oh, and here’s a statement that caught my eye as I was reading the dead tree version over lunch. MPI can keep reassuring Chinese consumers that New Zealand milk is safe, but:
But after the melamine, Mengniu milk testing positive for excessive levels of the carcinogen aflatoxin M1, and abnormal mercury levels in Yili milk powder scandals of recent years, domestic consumers, when faced with dairy product safety problems, are already as skittish as sheep.
Yup, that’s a fair summary, I think. And they give a couple of examples, of how some Chinese parents are responding to this issue, such as a Weibo post by “依依MM琼”, who has been feeding her baby New Zealand infant formula for a long time, now:
So worried! Exactly which milk powders have tested positive for DCD?
Precisely. Because neither MPI nor Fonterra has bothered to tell anybody which batches of which products tested positive, all New Zealand milk powder is under suspicion. If they’d tell us which batches were relaxed, then people could check, then either dump any dodgy stuff they have or relax.
Song Liang believes that if you want to know whether a dairy product is safe or not, you need to look at how mature the country’s production supervision system is, and in this respect, New Zealand is certainly trustworthy. At the same time he said this incident gave Chinese consumers a warning that one can’t blindly worship western brands, no country’s milk powder is absolutely safe.
Well, true, but MPI seems to have dropped the ball on this one, at least on the PR front. How different would things have been if back in September last year they’d announced precisely which batches of infant formula had tested positive for DCD?
So, I dunno, I can’t see from this article that there is an imminent risk of Yili or Yashili pulling out of their planned investments in New Zealand, and there are clear positives to Chinese investment in New Zealand dairy, but I do see a definite risk of, if MPI and Fonterra don’t get their acts together and start handling this situation properly, serious damage to New Zealand’s dairy exports being done.