Appearing at the select committee hearings on the Consumers' Right to Know (Country of Origin of Food) Bill, Fonterra head of global stakeholder affairs Philip Turner said “NZ origin is at the absolute heart of our trusted goodness campaign launched late last year, which is all about bringing greater value back to NZ from our products and we do support the desire to support the NZ origin of our food products.
“But what we have reservations on is for the bill to have unintended consequences for the dairy sector.”
This issue of new costs and uncertainty were also raised as a key concern.
“Mandatory labelling would create greater complexity and confusion for consumers.
“It would provide very limited additional benefit but would probably add significant cost and complexity to the packaging supply chain.
“The costs are hard to estimate the cost and size of the complexity without knowing the exact detail on what is proposed but they would include costs of changing and maintaining up-to-date labels and reduced flexibility in procuring ingredient products.
“Most importantly we see some risk that the bill could weaken or undermine our current NZ origin claims if it was poorly applied.”
Fonterra said it was unclear whether the addition of imported ingredient (even at exceedingly low levels) would preclude the ability to claim NZ origin. That included some flavours, processing aids or products used to fortify dairy products with vitamins and minerals.
Key examples included Fonterra’s fortified/lactose-free milk and plain yoghurt, which could contain as little as 0.2% imported ingredients.
Fonterra was also wary of the risk mandatory country of origin labelling was seen as a potential barrier to trade.
It said it could undermine its ability to argue against the introduction of such schemes internationally, where they were often used as a measure to discriminate against imports.
In its written submission Fonterra said “As a net food exporter, NZ stands to lose more than we gain by supporting such approaches.
“NZ dairy exporters work tirelessly to reduce the use of protectionist measures in overseas markets, including regulation that is designed to discriminate against imports. We seek regulation that is evidence-based and as consistent as possible with internationally accepted standards – both here and in our export markets.”
Turner accepted many of NZ’s trading partners applied country of origin labelling standards though they were applied in different ways. For example, some were applied to ingredients but not branded consumer products.
Asked if changes were made to the bill that would make it workable in the interests of NZ farmers, Turner said “Fonterra worries that we are trying to solve a problem that doesn’t exist so we don’t see a need in dairy to do anything.
“But if the Government does go down the track, Fonterra would be keen to work with the Government on the detail to ensure a least-costly and most simple outcome.”
