This does not look good. On Saturday I got home from a day of exams, and my inbox is full of reports of New Zealand milk powder containing toxic dicyandiamide (DCD). Some examples are here, here, here and here. Sunday’s news was the same, all DCD all the time. They all seem to refer to a Wall Street Journal report of DCD being found in New Zealand milk – this report? If so, it says Fonterra knew of the contamination before it launched its new shareholder fund last year, but didn’t report it. Somehow it’s not “material information”:

A Fonterra spokesman said Friday the company received advice from the government at the time that the low levels of DCD it found weren’t a food safety concern

It also reports that Ravensdown and Ballance Agri-Nutrients have suspended sales of DCD.

This Otago Daily Times report is interesting.

On the one hand, there are the optimists:

ANZ senior trader Alex Sinton said New Zealand officials had ”probably done everything behind the scenes” and ”smoothed things with the regulators”.

”It’s probably not such a big story even though people are arguing about whether it led the kiwi lower.”

Ha! Yeah, right! But I’ll get to that later…

There are also those with a more realistic view:

As no internationally set standard existed for DCD residues in food, because it had not been considered to have any impact on food safety, the detectable presence could be unacceptable to consumers and international markets, even in the small amounts found in recent testing, ministry deputy director, general standards, Carol Barnao said.

”Food regulators around the world are reflecting market demands with increasingly rigorous testing and, in some countries, there is zero tolerance to detected residues outside agreed standards,” she said.

And there are also lots of interesting details, like that DCD was developed to help control nitrate leaching into waterways,  that there’s no known food safety risk (doesn’t mean there’s no risk, but… ), and that:

Federated Farmers food safety spokesman Dr William Rolleston said the issue needed to be kept in perspective, as DCD-based nitrification inhibitors had been applied on about 500 dairy farms, out of about 12,000.

Ah ha. But then there’s the headline on that Hexun article:

八成中国进口奶粉都有问题？因为它们都来自新西兰

80% of milk powder imported into China is problematic? Because it’s all from New Zealand

Ah, yes, now that’s the kind of publicity New Zealand needs.

Apparently, 80% of China’s imported milk and 40% of its imported infant formula comes from New Zealand. But it’s really interesting to compare it with the ODT report. Compare the ODT’s calm, rational tone with the Hexun report. Not only does Hexun give a big, scary headline, it contains this statement:

双氰胺可用作三聚氰胺

DCD can be used to make melamine.

I’d be willing to bet that the final word of that sentence would appear to an awful lot of people in China like this:

MELAMINE!!!!!!!!!!

It then claims that DCD is commonly used by New Zealand farmers to prevent nitrates, which are harmful to humans, from leaching into waterways. Well, the ODT agrees with the use of DCD, but reports that of New Zealand’s 12,000 dairy farms, only 500 use DCD. And those figures come from Federated Farmers food safety spokesman Dr William Rolleston, so should be authoritative. What’s curious and confusing, though, is that a couple of paragraphs later Hexun says that only 5% of New Zealand dairy farmers use DCD, and then only 2 or 3 times a year, attributing that information to the Ministry for Primary Industries’ Carol Barnao, who is deputy director, general standards – again, what would seem to be an authoritative source. How you leap from “commonly used” to “5%”, I don’t know.

And Hexun then revisits the melamine issue by stating that DCD contains a tiny amount of melamine, but so little that the MPI couldn’t detect any in its tests. But the final paragraph takes us back to 2008’s melamine milk crisis, only this time with no mention of Sanlu. Nope. Fonterrra is the company named and shamed, with the reminder that the melamine milk caused the deaths of at least 6 babies and sickened 300,000 people. Yep, Hexun specifically writes “New Zealand’s largest company, Fonterra…” and Sanlu, its joint venture, is left anonymous. I find that most curious, because I remember back in 2008 everybody talking about Sanlu, but very few people picking up on the Kiwi connection. This strikes me as quite a drastic change in emphasis.

The second to last paragraph also contains an interesting sentence, especially in light of several instances of fake New Zealand infant formula or New Zealand-produced formula failing AQSIQ inspections last year:

新西兰政府的披露将可能导致中国政府对所有进口的乳制品进行全面、彻底、强制的检查。

The New Zealand government’s revelation could lead the Chinese government to carry out compulsory, complete and thorough inspections of all imported dairy products.

And now 新西兰时空 has a very well-timed post on Weibo under the #新西兰奶粉# (#New Zealand milk powder) hashtag, including images of MPI’s announcement, translated into Chinese, assuring consumers that New Zealand dairy products are safe. Scroll down for the English version if you need to. I wonder what effect that will have. I will be interested to see how this story plays out.