Canada would be in excellent position to capture huge dairy export sales if we didn't have supply management.
China, in particular, is shopping for the type of clean and safe infant formula that Canadians make from our relatively top-notch milk.
China has been buying a lot of New Zealand, but its dairy industry is on the ropes following a recall of 1,000 tons of dairy products from seven countries because it might be contaminated with a strain of clostridium bacteria that could cause botulism.
New Zealand’s Fonterra dairy, the fourth-largest in the world, is scrambling to get control of the potentially-contaminated milk and products that have been made with the milk and dairy components and ingredients.
Even more damaging to the country's reputation is the fact that Fonterra has been investigating the discovery of clostridium bacteria in its products since March. The highly-dangerous strain was identified July 31.
And now the company is refusing to reveal the many products and supply chains involved in the recall.
The products include infant formula, sports drinks, protein
drinks and other products made
with Fonterra milk or components.
China, Saudi Arabia, Malaysia, Vietnam and Thailand are all
involved plus New Zealand food-processing companies.
New Zealand is the world’s largest dairy exporter and
Fonterra handles all of the exports. It’s a farmer-owned co-operative that took
over New Zealand’s government monopoly on dairy exports.
It’s the second hit to New Zealand’s dairy industry.
Earlier this year, Fonterra announced it had
discovered trace amounts of the agricultural chemical dicyandiamide in some of
its products, prompting a ban on the chemical's use on New Zealand farms.
Because of supply management in Canada, the World Trade Organization says exports from Canada are cross-subsidized and therefore targets for legitimate and large tariffs on Canadian dairy products.
That keeps Canadian exporters from being able to compete with other exporters, especially the United States.
