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Current as of 28/04/17 07:40PM NZST
The Business Herald’s markets and banking reporter.

Fonterra boss not told fast enough

Spierings says swifter action to sideline affected products might have occurred had he been informed earlier.

Fonterra chief executive officer Theo Spierings. Photo / AP
Fonterra chief executive officer Theo Spierings. Photo / AP

Fonterra chief executive Theo Spierings says he wasn't informed of the contamination event that led to the company's botulism fiasco quickly enough and much swifter action to "sideline" affected consumer products might have taken place had he been told of the problem earlier.

The dairy co-operative, New Zealand's largest firm, first became aware of a possible "quality issue" with 38 tonnes of a whey protein called WPC80 in March this year.

Fronting a news conference in Auckland yesterday, Spierings said he didn't necessarily need to be informed of the problem at that point, but he should have been told at the end of June when Fonterra asked AgResearch to test the WPC80 for the presence of clostridium botulinum, a bacterium that can cause botulism.

Instead, he didn't find out about the contamination event until the evening of August 1, after test results suggested the botulism-causing bacteria could be present in three batches of WPC80 produced at Fonterra's Hautapu plant in the Waikato in May 2012.

Fonterra went public with the contamination announcement on August 3.

Had he been informed of the problem in June, Spierings said he might have made the call to "sideline" consumer products that were at risk of contamination until further testing was completed.

Affected products, including infant formula, were not recalled until August.

"The red flag should have gone up faster," Spierings said.

Last week it was finally revealed that the WPC80 was contaminated with clostridium sporogenes, which does not present a food safety risk.

Meanwhile, Fonterra yesterday announced it had completed its operational review of the botulism scare, which found reprocessing of the WPC80 after plastic was found in product led to the contamination.

"An item of non-standard equipment [a since decommissioned transfer pipe used during the reprocessing] caused the contamination," said Fonterra strategy director Maury Leyland.

Spierings said the plastic had entered the whey protein as a result of human error.

"It just dropped in," he said.

Fonterra said the decision to reprocess the original whey protein produced at Hautapu, rather than "downgrade" the product - in combination with the use of the item of non-standard equipment - resulted in the contamination.

A lapse in information sharing between two parts of the co-operative also led to delays in testing, the company added.

Spierings said Fonterra now needed to focus on becoming "best in class" in terms of food safety.

"The [dairy] season is kicking in and we need to get into action mode."

Spierings said Fonterra was implementing improvements in its business, and a new role of group director of food safety and quality had already been created.

Food & Grocery Council chief executive Katherine Rich welcomed the operational review, which she said had been thorough and asked the tough questions about how and why the recall occurred.

- NZ Herald

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