Fonterra advised Government officials last week that it had the Chinese had threatened "retaliatory measures".

Dairy giant Fonterra told Government officials it had been approached by Chinese commerce representatives, warning of reprisals if they did anything to compromise Chinese steel imports.

It's the latest revelation in a series of about-turns about the Government's knowledge of Chinese threats of a wider trade war.

Already, both the Government and kiwifruit giant Zespri have back-pedalled on claims they had not been briefed about Chinese anger. New Zealand officials are looking into allegations it dumped cheap steel on the New Zealand market, and the world's biggest trading nation has been making its fury known to New Zealand exporters.

WARWICK SMITH / FAIRFAX NZ Manawatu dairy farmer Andrew Hoggard, who chairs the Federated Farmers dairy division, says a trade war with China is precisely what farmers don't need right now.

It can be revealed Fonterra was also approached and warned of consequences, should the Government investigate any such complaint laid by Pacific Steel.

READ MORE:

* Q+A: Why China cares so much about NZ's steel-dumping probe that it is threatening reprisals

* Government admits it knew of Chinese approach to Zespri

* Chinese steel tariff could increase construction costs, importer says

* Kiwi steelworkers and dairy farmers fear Chinese trade threats

* China threatens reprisals on NZ dairy, wool and kiwifruit

Fonterra informed Wellington officials at the Ministry of Business Innovation and Employment (MBIE) of the communication. Industry sources said Fonterra trade policy manager Jenny McGregor contacted NZ trade officials last week, to confirm Fonterra's Beijing office had been contacted earlier in the week by Chinese commerce representatives.

JOHN HAWKINS/FAIRFAX NZ Trade Minister Todd McClay has backtracked on initial claims he was unaware of any meeting between Zespri and his officials.

Fonterra was warned China would take "retaliatory measures" against NZ exports if NZ were to put in place penalties, or even investigate putting in place penalties, against Chinese steel.

China has signalled moves to undertake "industry consultation" – the first step towards trade barriers that would restrict the access of New Zealand agricultural exports, including dairy, wool and kiwifruit. Constrained access to the Chinese market would be a massive blow to New Zealand – the Asian nation has a population of 1.35 billion.

Fonterra director for global stakeholder affairs Phil Turner said there had been "rumours on the ground that Fonterra concluded were simply that – unsubstantiated rumours".

WARWICK SMITH/Stuff.co.nz Manawatu dairy farmer Andrew Hoggard says struggling farmers can't take another hit from a trade war with China.

"Fonterra has not received any threats, has not been approached by the Chinese Government, and does not have any information related to the rumours which includes the source of the initial speculation."

MBIE is deciding whether an investigation should go ahead.

Talking to media in Jakarta, Prime Minister John Key said the Government's position had not changed. But his language appeared to shift from there being no knowledge of an issue at all to an issue that would not warrant "retaliatory action".

NZTE Matt Crawford, corporate relations manager for Zespri, first conveyed the Chinese threats to NZ trade officials.

"The position from the Government's point of view is the same, which is neither in Beijing nor in Wellington is there any indication from the Chinese authorities that there is an issue that would see them have retaliatory action."

Trade Minister Todd McClay confirmed he had received new information, which he sought overnight – five days after questions were first put to him. "I've checked overnight and when I was in China I did receive some information from the embassy that an industry body made contact with a New Zealand company in China raising some concerns."

But he said Mofcom – China's trade ministry equivalent – has denied any knowledge an approach occurred.

SAM SACHDEVA/Stuff.co.nz Prime Minister John Key says he has heard nothing about potential retribution from China if we impose sanctions on them dumping steel into the New Zealand market.

"I also note that we have had a meeting in Wellington with the Chinese embassy who've also confirmed they're not aware of any impending trade sanctions from the Chinese government, directed towards New Zealand or specific New Zealand companies," McClay said.

Zespri followed suit shortly after McClay's comments, releasing a statement confirming – but downplaying – a Chinese approach to their own employees based in Beijing.

On Friday, Zespri's chief operating officer Simon Limmer had denied any knowledge of an approach when questioned by Fairfax Media.

Then on Tuesday, Fairfax revealed that Matt Crawford, corporate relations manager for Zespri International, based in Shanghai, had called New Zealand's Beijing-based trade officials this month to brief them on the Chinese anger at New Zealand's willingness to accept a complaint about steel imports, and the threat of trade reprisals.

In a statement, Zespri confirmed its local staff in Beijing received "unsubstantiated information" from an industry body in China on "purported industry consultations related to the import of New Zealand agricultural products".

That was two weeks ago, a spokeswoman said. "We passed on this information by email in line with our regular engagement with New Zealand Embassy officials in China through the normal course of business.

"Outside of this single communication, Zespri has no further information on this matter and reports that Zespri was called in for a meeting in Beijing or was in some way pressured by the Chinese government are false."

Key said the Chinese ambassador had given "an absolute assurance" there would be no reprisals taken against New Zealand if it chose to investigate any allegations of steel dumping.

NZ First leader Winston Peters said the Government was in "total denial of information they had to have had".

He said the approaches in dealing with all three industries by China had been handled differently. "It's inconceivable that ministers and ministry officials could not have known.

"This is a world where there is a huge battle for resources, and there are huge demands upon the Chinese Government in terms of looking after it's own people.

"Whilst one can understand their approach from their point of view, there is no way we should be complying with it."