Hon Jim Sutton

Opening Of Southern Fresh Milk Factory, Invercargill

Good Morning, chief executive Alasdair McLachlan, ladies and gentlemen.

It is always welcome to celebrate the opening of a new ice-cream manufacturing factory, with the consequent flow-on to the community not just for those who have jobs at this factory, but also the milk suppliers in the area and other providers of services to the workers.

There is also a significant part of the New Zealand community which is always happy to hear about new ice-cream producers!

I'm told that Southern Fresh has had a developing success story during the past five years. Sales have risen from about $9 million to about $24 million during that time. Southern Fresh now employs 130 people about 100 full-time equivalents.

Part of that success includes a 10-year contract to make ice-cream for Movenpick, the luxury ice-cream brand.

That success has led to our presence here today to celebrate the opening of a new ice-cream manufacturing factory, increasing Southern Fresh's capacity.

New Zealand is a world-leader in food processing technology and how we apply it.

I have just returned from a trade mission to India and Nepal, and I found it fascinating.

India is one of the largest food producers in the world. In fact, the country is self-sufficient in food. But most of it is consumed close to where it was produced. Estimates are that up to 40 per cent of food in India spoils or is otherwise lost before it can be used.

In comparison, New Zealand produces far more than we can use.

Some people say we produce enough food for 200 million people. I don't know about that, but because we produce more than we need, we have to sell it to other countries. That means knowing how to process and store food properly and safely.

We have expertise in processing, storing, packaging, marketing, transporting, and distributing food, so much so that you would be hard-pressed to find someone who could do it better.

This is an example of that a cutting edge factory, to produce some top-class product.

However, as minister of agriculture and trade negotiations, I must also raise some points.

I have read how your company is chafing under the requirements of this country's legislation. Perhaps I can usefully spend some time explaining why we have these rules.

First, I have to clarify that there are two issues food safety requirements and export rules.

Let's start with food safety.

It is vital for New Zealand's reputation as a superior food producer that all manufacturers of food produce safe food and adhere to the rules and regulations surrounding that.

Events in Japan earlier this year should have caused chills to run up and down the spines of food producers everywhere.

Japanese dairy producers, Snow Brand, were forced to close their entire production line after food poisoning scares from one of their milk processing plants.

As the story emerged, huge numbers of Japanese people traditionally sensitve to food fears stopped eating dairy products. The whole dairy market in Japan has taken a severe knock and as a consequence, the Dairy Board has lost significant sales, damaging New Zealand profits - although our products were not affected by the poisoning.

Even its excellent reputation for product quality has not saved the Dairy Board from being snubbed by consumers who are worried about what they eat.

Back here, New Zealand has one of the highest rates of food poisoning of any developed nation in the world.

The latest statistics, published in the Medical Journal in July, show that 119,000 individual cases of food poisoning were reported in New Zealand last year. These generated about 19,000 general practitioner visits, 400 hospital admissions, 22 cases of long-term illness, two deaths, and cost the country about $55.1 million. The journal reported that more than 360 "outbreaks" defined as more than one person becoming ill through eating the same food were recorded in New Zealand last year, but health officials said that was only the tip of the iceberg. Six of those recorded outbreaks were from dairy products consumed here.

But why do the poisoning of local people from local food affect our international markets

The perception the poisoning rates give is that food here is not safe, even though our export products are of the highest quality. Our customers must be continuously reassured not only that we have the necessary rules to protect their safety, but that those rules are relentlessly enforced and religiously observed.

Food exports are worth $20 billion to this country, about two-thirds of all exports. We can't afford to get it wrong.

That applies to all food producers, not just those manufacturing exports. An outbreak here could decimate our export sales. The folly of one producer would not only damage their own livelihood, but that of many others, farmers and producers alike.

That is why it is essential for you at Southern Fresh and for every other milk processor to have robust, recognised food safety programmes. Your factories must be accredited by the Agriculture and Forestry Ministry before any product is exported.

MAF have an outstanding international reputation for food assurance. I won't let anyone damage that.

On the other issue, which is your unhappiness with the export regulations, in particular, the single desk arrangement well, there is some sympathy for your views, but this whole issue is up for discussion as part of the dairy industry restructuring.

The dairy industry is in a period of change and the ultimate result of that is not clear. As an industry participant, you have a responsibility to get involved if you want a particular outcome.

Food for thought.

In closing, I would like to congratulate everyone involved with this operation staff, management, suppliers, and those who built the factory.

Today is your celebration.

I am delighted to declare this Southern Fresh ice-cream factory open.

Office of Hon Jim Sutton

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