China to step up scrutiny of milk powder imports from New Zealand

China has enhanced the scrutiny of milk powder imports from New Zealand, its quality control regulator said, after people who claimed to be environmental activists threatened to contaminate the infant formula made in New Zealand, the top global dairy exporter.

According to the statement of New Zealand police yesterday said letters had been sent to the national farmers' group and the dairy giant Fonterra in November accompanied by packages of infant formula laced with the pesticide 1080, formally called sodium fluoroacetate.

The New Zealand dollar was dragged to a six-week low by the poisoning scare over concerns about the possible effect on the country, which depended on dairy products for about a quarter of its export earnings. China is New Zealand's biggest dairy buyer.

''China has already taken steps and will demand each batch of milk powder imported from New Zealand has an official New Zealand certificate that it does not contain 1080,'' according to the news release posted by the Chinese General Administration of Quality Supervision, Inspection and Quarantine on its website.

According to the regulator, importers needed to provide test reports that the product was free from the contaminant, and that dealers needed to ensure that all packaging was intact.

China is New Zealand's biggest dairy buyer, with purchases worth $3.11 billion of milk powder and other products in 2014, nearly a third of all global exports.

Small New Zealand companies marketing formula in China had already seen order cutbacks according to Michael Barnett, chairman of the New Zealand Infant Formula Exporters Association.

He told Reuters that the association had received its first response from the distribution network.

He added their orders had been reduced, some of them by up to 70 per cent. He added that any negative online exposure could fan concerns in China.