How Fonterra is dealing with Covid-19 in Greater China

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China is coping well with the Covid-19 crisis so far, Fonterra chief executive for Greater China Teh-han Chow says.

"Here in China, by and large, I think things are fairly normal," Chow told The Country Sport Breakfast's Brian Kelly.

New Zealand's lockdown was "all across the news" in China, and Chow sympathised with Kiwis currently in Level 4.

Three weeks ago, an outbreak in Nanjing spread to many cities, which resulted in lockdowns around China.

"I know how tough lockdowns can be," Chow said.

In China, when certain areas were designated high-risk, whether they were as small as a city block, or in some cases - an entire city - they were locked down.

Since the outbreak, everybody was assigned a health code that was kept in their smartphones, Chow said.

A green symbol health code proved someone had not been to any medium or high-risk areas.

If someone had visited a medium or high-risk area, their health code would be yellow or red, Chow said.

"So in order for me to get into the office building, to go to a shopping mall, to visit customers, to check into a hotel, to get into and aeroplane - I need to have that smartphone and that green code."

Contact tracing was a crucial tool China used to keep any outbreaks in check, Chow said.

Meanwhile for Fonterra, Covid was affecting some key ports, such as Shanghai, Shenzhen and Tianjin, where product was coming in from New Zealand.

"All of these cold chain products that are now being imported have to be transported to a designated point to do disinfection and inspection.

"So as you can imagine, there's a huge queue for this to get done and this has also resulted in an increase in logistics costs for us, through additional handling and inspection charges and container detention charges."

In some cities, such as Guangzhou, local government required cold chain imports to be transferred to designated warehouses, where they all had to be disinfected, tested and certificated as Covid-19 virus free before being distributed, Chow said.

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"This all adds up in terms of costs and time and we have to wait in line, and warehouse capacity is scarce, so this unfortunately also results in some of the delays that our customers will be affected by."

Since late July, there had been tighter controls and measures on pandemic prevention from local governments across China, amid further outbreaks in Nanjing and Yangzhou - both cities are about 300km from Shanghai.

This had affected Fonterra staff, as it was "a little close to home," Chow said.

"The key impact is on travel. We've asked all of our employees to cancel non-essential business travel.

Employees were being cautious with personal travel as well, as low-risk areas could rapidly change to medium or high-risk, Chow said.

"You could be subject to a lockdown unbeknownst to you, when everything seemed alright when you left."

Chow was pleased to report no one in the co-op's Greater China team had been infected and Fonterra's vaccination rate, including the Taiwan and Hong Kong teams, were at 85 per cent.

"It's great to see that vaccinations are becoming more readily available in New Zealand as well."

Also in today's interview: Chow talked about Fonterra Greater China's latest award, as the co-op was among the top 100 companies to win the Most Attractive Employer Award in a recent survey.