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Fonterra has a large footprint in Sri Lanka with a 65% market share that climbs to 76% when yoghurt is included. The company, which operates both a powder and liquid plant in the island, has pledged to recall the milk within 48 hours, but insists that it was done as a conciliatory measure to reduce panic and work with Government health authorities and is emphatic that the stock does not contain DCD.
The milk was distributed in March – Anchor 1+ (batch no. 107610163) and Anchor Full Cream Milk Powder (batch no. 0605C0883).
Sri Lanka’s Health Ministry initially claimed that they had not found any traces of DCD in milk samples they had sent to Thailand for testing. However, another Government entity found traces of DCD in four imported milk powder samples.
Tests done by the Industrial Technology Institute (ITI) ultimately became the foundation on which the Sri Lankan Government demanded the withdrawal of 39 metric tons of milk powder.
Fonterra has countered the claim and insisted that independent laboratory tests have confirmed that there have been no DCD detected in milk products distributed in Sri Lanka and is willing to work with ITI to correct its test results.
The company is adamant that while DCD has never been a food safety risk, since 1 June 2013, every single batch of Fonterra product entering Sri Lanka has been tested for DCD, using methods specified by the Sri Lankan Ministry of Health.
As many as 202 tests carried out on Fonterra branded products by independent and internationally recognised testing laboratories, AsureQuality and the Cawthron Institute show no traces of DCD.
“Fonterra takes its responsibility on safety and quality very seriously. That is our top concern and we are dedicated to being completely transparent with you and the public of Sri Lanka on matters of food quality and safety,” Fonterra Managing Fonterra Brands Sri Lanka Director Leon Clement told media.
He went on to point out that there is widespread “confusion” among the public of Sri Lanka at the moment and panic that all Anchor products are impacted by this recall and stressed that this directive is limited to two selected batches and the rest of Fonterra products are unaffected and safe for consumption.
“I’d like to talk to you about this substance called DCD and I actually have some with me here. I also want to assure you that none of our products in Sri Lanka contain DCD and finally I’d like to talk about the test method that has been used in Sri Lanka as basis of the request from the Health Ministry to recall our products.”
“In my right hand I have a small packet of common table salt, in my left hand there is a sample of DCD. All of us consume table salt on a daily basis, what is in my right hand is far more dangerous and hazardous that DCD. It has higher acute toxicity and it has higher chronic toxicity and this data is available as part of the US Environmental Protection Agency,” he said, pointing out documents released by the European Commission saying DCD is not harmful for humans.
For DCD to be harmful, a quantity of milk large enough to fill a moderate sized swimming pool would have to be consumed by one person, Clement noted.
“So this sample of DCD is completely harmless, right,” he said holding up a small vial, “so I have just tasted DCD and it is completely harmless,” Clement stressed as photographers frenziedly captured the moment of him putting a finger into the tiny granules and into his mouth.
Antics aside, the local Health Ministry and public remain unconvinced.
Pressured by doctors and the New Zealand Government’s botulism alert, which was issued over the weekend, resulting in China and Russia recalling milk products from that country, Health Ministry officials on Thursday decided to suspend sales of all milk products imported from New Zealand, particularly those from Fonterra.
They also obtained a court injunction banning advertising of all Fonterra products until 21 August – the date when Government test results will be available since the public have been bombarded with commercials emphasising the safety of imported milk products.
The decision sparked panic with most supermarkets and shops taking all New Zealand milk products off their shelves, including local brands Maliban non-fat and Diamond milk in line with results from ITI tests.
Responding to a question by the Daily FT, Clement stated that the company was yet to calculate its losses from the DCD and botulism scare, but it could run to tens of millions given its high presence in the local market.
According to the Fonterra website, its powder plant in Colombo’s outskirts packs 475,000 packs of milk each day and blends 5,270 metric tons of milk powder every month. Its liquid counterpart processes half a million yoghurt cups a day, producing 10,370 tons of cultured products, 850 tons of pasteurised milk and 2,460 tons of UHT products every year. Some of the liquid dairy is procured from 4,000 odd local farmers.
Fonterra initially played down worries on DCD in January after China, Malaysia and Taiwan found traces of the substance during locally-conducted tests.
Fonterra is New Zealand’s largest company with revenues of around 20 billion New Zealand dollars (US$ 16.8 billion), with 90% of the milk collected being exported around the world.
