Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

NZ dollar slumps on Fonterra product contamination

NZ dollar slumps on concern about exports after Fonterra food contamination scare

By Tina Morrison

Aug 5 (BusinessDesk) – The New Zealand dollar slumped on concern a food contamination scare at Fonterra Cooperative Group, the nation’s largest dairy company, will hit exports.

The kiwi fell to a month low of 76.99 US cents, and recently traded at 77.15 US cents from 78.31 cents at the New York close and 78.87 cents at the 5pm market close in Wellington on Friday. The trade-weighted index dropped to 73.71 from 75.16 Friday.

The local currency slid after Fonterra, the world’s largest dairy exporter, said on Saturday it had found bacteria which can cause botulism in some of its dairy products, prompting China and Russia to ban products. Dairy makes up about a quarter of New Zealand’s export earnings.

“The kiwi has dropped a cent and a half in reaction so far because it has affected exports,” said Imre Speizer, senior currency strategist at Westpac Banking Corp. “ Countries have suspended exports and the kiwi has had a knee jerk reaction. Until we do some quantitative analysis on exactly what this means for the New Zealand economy, I can’t say how much further the kiwi will go or not go.”

The contamination scare comes five years after the scandal in China over Sanlu Group, which was 43 percent owned by Fonterra and whose milk was found to be laced with melamine. Fonterra revealed in September last year that traces of a fertiliser additive known as DCD was found in some milk samples.

The local currency fell to 58.10 euro cents from 59.70 cents Friday and dropped to 50.49 British pence from 52.16 pence. It slid to 76.40 yen from 78.50 yen and weakened to 86.48 Australian cents from 88.58 cents.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 


Auckland Airport: North American Touch Downs Make AA Most Connected In Australasia
The return of American Airlines, the world’s largest airline, announced today has cemented Auckland Airport’s title as the Australasian airport with the most non-stop connections to the United States and Canada... More>>



Reserve Bank: Monetary Conditions Tighten By More And Sooner

The Monetary Policy Committee today increased the Official Cash Rate (OCR) to 2.0 percent. The Committee agreed it remains appropriate to continue to tighten monetary conditions at pace to maintain price stability... More>>


The Download Weekly: Vodafone FibreX back in court

Vodafone and the Commerce Commission head back to court over FibreX in a week the TCF issues broadband marketing codes that should avoid similar problems in the future... More>>



Kiwibank: Savers To Benefit From Higher Returns Following OCR Rise

Following market movements Kiwibank is pleased to increase the interest rate and rates of return on its savings accounts... More>>

Fonterra: Provides 2022/23 Opening Forecast Farmgate Milk Price & Business Performance Update
Fonterra today announced its 2022/23 opening forecast Farmgate Milk Price and provided an update on its third-quarter performance... More>>


Stats: Quiet Start For Retail In 2022
The volume of retail sales was relatively unchanged in the March 2022 quarter, following a strong increase in the December 2021 quarter, Stats NZ said today... More>>