These are tough times for New Zealand in the Chinese dairy market, one which it has dominated for many years through the giant Fronterra.

The sector is in the news again after more milk products sold to China were banned after the discovery by tests in China of higher-than-acceptable levels of nitrates in lactoferrin.

New Zealand's agricultural regulator said last week it had revoked export certificates for four China-bound consignments of lactoferrin, a naturally occurring protein found in milk, manufactured by Westland Milk Products. Two of the consignments had been shipped to China but had not reached consumers, New Zealand's ministry of primary industries said. The consignments were derived from two affected batches of lactoferrin manufactured by Westland at its Hokitika factory.

Previous scare
The incident comes just weeks after Westland's much larger competitor, Fonterra, said some of its dairy ingredients were contaminated with a bacterium that causes botulism, prompting a recall of infant formula, sports drinks and other products in China and other Asian countries.

The scares have sparked concerns over quality and testing in the largest dairy exporter.

Irish food companies will be watching closely, as they are active in the infant formula market in China, as suppliers or as joint venture partners.

Last week the MPI said it would step up its regulatory oversight of the dairy industry.

"Our dairy sector . . . reputation is built on the strong assurances our regulatory system provides and the quality of New Zealand's products," MPI acting DG Scott Gallacher said.

China has urged the New Zealand government to thoroughly scrutinise its dairy companies and products to ensure the safety of exports.