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Fonterra involved in Chinese milk scandal

00:00AM Sep 17, 2008
China's poisoned milk crisis is worsening and the New Zealand company Fonterra is defending how it has acted over the scandal. Beijing says a third infant has died and more than 6,000 have gotten sick from drinking infant formula laced with the chemical melamine.  The number of infants diagnosed with "acute kidney failure" has risen to 158.  

Melamine was apparently added to increase the milk's protein content. The Chinese company responsible, San Lu, is 43% owned by Fonterra.  Fonterra's chief executive, Andrew Ferrier, says the problem was not disclosed for six weeks in order to work with the Chinese authorities getting contaminated product off the shelf, which has been done. 

On the issue of compensation, Ferrir says the company will work with the Chinese Government, but he gave no details.  He also revealed complaints about sick children had been coming in since March, but melamine was not detected for several months.  When it was, Fonterra says the Chinese government was immediately informed.  

He said the chemical was not found until very late because melamine does not naturally occur in milk and so tests are not normally carried out for it. Chinese state television says the industrial chemical melamine has now been found in baby milk powder produced by 22 companies.

San Lu's chairwoman and general manager Tian Wenhua has been fired from her company posts and from a high position in the Communist Party. Other senior officials have also been fired and several people described as milk dealers arrested.