Concerns over the active ingredient in top-of-the-range nitrogen fertilisers are a trade issue, not a food safety issue, industry leaders say.
The product is DCD, used widely around the world in a range of industries, including agriculture, for the past 30 years but only now being noticed by food regulators.
“The product is extremely safe and stable,’’ Ministry for Primary Industries deputy director general (Standards) Carol Barnao said. “That’s why there have never been international standards set for it.’’
The risk now is that with consumers becoming more environmentally interested, a chance detection of an unexpected residue in food could lead to a trade backlash.
Ravensdown has voluntarily taken its market-leading eco-n fertiliser off the market, after low levels of DCD were found in samples of whole milk powder. No residues have been found in butter or cheese.
The residues were found by dairy company Fonterra in small quantities of milk powder manufactured in September. There were no residues in product made in October or November.
“The last thing we or the industry needs is to tarnish the New Zealand reputation,’’ Ravensdown chief executive Greg Campbell said.
He also said the issue was trade risk, not food safety. Residue levels were measured in decimal points – parts per million.
Ballance Agri-nutrients has not sold its DCD-based product DCn since July last year. This has had much smaller sales than eco-n, so the impact of the sale suspensions will fall mainly on Ravensdown.
However, the use of DCD in the dairy industry is low. It is applied to only about 4% of farms nationwide. Eco-n accounted for just 1% of Ravensdown’s annual NZ sales of more than $800 million.
There had not been any food product export sales lost so far, or any suggestion of losing sales.
MPI has explained the situation and the initiatives being taken to major trading partners and overnight Thursday they had acknowledged NZ’s reputation for transparency and honesty in its dealings, Barnao said.
“There’s no food safety concern whatsoever. This is more about people’s expectations.’’
Though sold only in small volumes, the two DCD products were regarded as key weapons in reducing nitrate leaching in dairy pastures and reducing greenhouse gas emissions, as well as improving pasture productivity.
In NZ, DCD is the only product included in the formal inventory to reduce greenhouse gas emissions. The suspension will slow the work being done in this field, but the government and MPI were already looking at options in addition to those involving DCD, Barnao said.
The two big fertiliser companies have taken their DCD products off the market until the trade risk issue is resolved. The solution will involve efforts to establish a new international standard, which could take some time.
“It is a bureaucratic process and won’t happen overnight.’’
The companies say they have other tools to safeguard environmental issues, including sophisticated soil testing and exact spreading of standard nitrogen fertilisers.
DCD would have been applied next in autumn, so farmers have time to organise alternative fertiliser applications.
Detailed testing by NZ agencies (Landcare in 2003 and MAF and Food Safety Authority in 2009) found no food or safety concerns with the DCD products, Barnao said.
Food regulators were now reflecting market demand, with increasingly sensitive and rigorous testing, with regulators in some countries having a zero tolerance for unexpected residues.
Testing indicated that in favourable conditions, with rainfall, the residues could be gone from the pasture in five days or so, she said.
The issue surfaced late last year, just as Campbell was taking up his new post at Ravensdown. He called it a baptism of fire.
The need to suspend sales was a setback and a speed-hump for the farmer-owned co-operative, not a failure of the product, he said. Ravensdown would continue its research with partner groups such as Lincoln University to improve the technology.
“Sales aren’t high now, but it is the potential for growth that we can lose out on. We believed we were on the cusp of proving a product which farmers and the industry had been looking for.’’
Ironically, the farmers using eco-n and DCn were those who had probably been most environmentally aware, although sales were skewed to the South Island because climate and ground conditions were more amenable than particularly northern parts of the North Island, he said.
“It’s fair to say that the early adopters are those farmers who were most aware of their footprint on the land.’’
The facts on DCD
- DCD (dicyandiamide), developed about 30 years ago, is a non-toxic, water-soluble compound that breaks down rapidly in the soil and leaves no lingering residue.
- It is regarded as the best means of reducing nitrate leaching from dairy farms and of reducing greenhouse gas emissions, while also boosting pasture production. New Zealand is the only country spraying DCD on to pastures, though it has a range of uses in other countries.
- DCD has been sold by Ravensdown since 2004 as the active ingredient in eco-n, and to a lesser extent by Ballance Agri-nutrients in DCn. These products have been taken off the market.
- Only about 500 dairy farms, out of a total of more than 12,000 farms, have applied DCD.
- DCD is applied twice a year, in autumn and spring.
- The Ministry for Primary Industries set up a working party in December involving the two fertiliser groups, Fonterra, and other dairy companies.
- MPI says there are no food safety concerns. At issue is the possibility of unexpected residues being found, affecting New Zealand’s trade reputation.
- Major trading partners have been informed and MPI will work to have an international standard adopted.