New Zealand Dairy Health Scare Has Lessons for U.S.
Aug 09, 2013
We’re just one food sanitation slip-up away from being in the same boat as New Zealand.
Cows, like the folks who milk them, don’t take Sundays off. But the milk they produce each Sabbath is destined for off-shore markets. That creates tremendous opportunity—and heightened risks.
Think about it. The United States is now exporting 13% to 14% of its milk production, which means every seventh day’s production must be processed into products that the world wants.
When I woke up on Sunday morning, Aug. 4, I saw the first report of New Zealand’s milk safety problem. Clostridium botulinum had been detected in some of New Zealand’s whey protein concentrate that had been shipped to China. The first reports that morning were that China was banning all New Zealand dairy products. Russia, Hong Kong and Sri Lanka quickly followed suit.
Markets reacted quickly. Fonterra's Global Dairy Trade Price Index declined 2.4%. And because New Zealand’s $9 billion of dairy exports account for roughly a fourth of the country’s export earnings, even the New Zealand dollar dipped slightly.
So the time-faded bumper sticker, "Think global, act local," could not be more true. Just the day before the New Zealand dairy safety crisis broke, I had toured the Upstate Niagara Cooperative yogurt and cottage cheese plant in West Seneca, N.Y., just down the freeway from Buffalo.
Jay Jaskiewicz, plant manager, led the tour. When asked what his greatest concerns were managing the plant, he immediately responded: "Employee and food safety. You can always make up a day of slow production. But the things that keep you up at night—the things you lose sleep over--are employee safety and product contamination."
During our tour, both of those concerns were in evidence everywhere. Safety reminders were ubiquitous; food safety testing and record keeping were constant. Batch samples are kept for months to be able to track a problem should, heaven forbid, it ever occur.
I presume such safety measures are in place in every dairy plant in America. It’s a certainty they are in New Zealand plants as well—which has a stellar, global reputation for quality dairy products made to exacting customer specifications. And yet a problem occurred.
One can only hope dairy plant managers lost a little sleep last week over this incident. And more importantly, they hopefully redoubled efforts to enforce sanitation protocols to keep products safe.
Dairy farmers need to heed this warning as well. We’re just one food sanitation slip-up away from being in the same boat as New Zealand. It’s another reason why managing price risk is more important now than ever. In our 24/7 globally-connected world, market traders don’t take Sundays off either.
You can read more on the New Zealand dairy safety crisis here and here.