Impact of milk scare 'limited' for NZ exports

Although some New Zealand exporters are worried that consumer concerns over contaminated milk powder from global dairy giant Fonterra Co-operative Group Ltd will mean declining sales to China, they may not feel a pinch, at least not in the long run.

China has banned tainted milk powder from New Zealand. Meanwhile, authorities in New Zealand are investigating the contamination scare to allay consumer fears in China, as they try to keep the issue from affecting trade overall.

The head of New Zealand's farming industry, Federated Farmers of New Zealand President Bruce Wills, issued an unconditional apology to Chinese consumers over the dairy issue and praised the Chinese government's reaction to the crisis, said the Xinhua News Agency.

New Zealand Prime Minister John Key said on Sunday that he is likely to visit China once inquiries into the Fonterra food safety scare have been completed.

"It's really about what is the damage to New Zealand's reputation, both for Fonterra and for dairy products, but also for the wider products we sell into the Chinese market and other markets overseas," Key said in an interview with Television New Zealand, according to Bloomberg News.

Key said the challenge now for Fonterra and New Zealand is to restore confidence with Chinese consumers, but he is confident that any long-term damage to New Zealand's reputation can be limited, Xinhua reported.

China overtook Australia as New Zealand's biggest export market in the first quarter of 2013, according to Statistics New Zealand.

The country's total exports to China have almost tripled since 2008, rising from $2.1 billion to $6.1 billion in 2012.