Why Fonterra accepted defeat in the dairy aisle
OPINION: Fonterra's sale of its consumer dairy business to Lactalis is a clear sign of the co-operative’s failure to compete in the branded consumer market.
Jeremy Kerr, the owner of another pest-control product, Feratox, mixed highly concentrated 1080 with baby milk formula and posted them to Fonterra and to Federated Farmers. Included in the package was a letter demanding the country stop using 1080 or he would release poisoned infant milk powder into the Chinese market
and one unspecified market.
He was jailed last week for eight and a half years by Justice Geoffrey Venning, who said the potential impact of his actions on New Zealand's trade relationship with China and others was "extremely serious".
The threat is believed to have cost Fonterra nearly $20 million and cost Federated Farmers nearly $100,000.
In his victim impact statement, Feds chief executive Graham Smith said Kerr's actions were "a direct threat to the very fabric of society".
The threat could have led to an international ban on NZ food products, he says.
"The 1080 threat had the potential to devastate our ability to successfully operate within these markets and would have cost the country billions of dollars. Customers would have stopped buying and using our products due to their immediate safety concerns."
There was a potential threat to all sectors of society, given NZ's reliance on primary industries, Smith says.
Fonterra chairman John Wilson said Kerr's actions were deplorable and had a huge impact on the cooperative and other food firms.
Fonterra's Maury Leyland says the threat had a big impact on Fonterra and it staff.
"It's hard to imagine a worse threat to children and families, or to the viability of our co-operative, the wider dairy industry and our country," said Leyland, who is Fonterra's outgoing managing director of people, culture and safety.
