Beijing: Five batches of an infant formula milk powder made by a Chinese company have been found to be tainted with a highly toxic aflatoxin, a substance that can cause severe liver damage or even cancer.
The Nanshan Bywise milk powder, produced by the Hunan AVA Dairy Co., failed tests conducted by the Guangzhou Industrial and Commercial Administration Bureau, the Global Times reported Monday.
Another milk product brand, Bright Dairy, also failed recent sample tests.
An analyst said the claim would hurt the producer`s sales and push consumers further away from domestic brands.
"The scandal will surely dampen the short-term sales of Nanshan," said a dairy industry analyst at Beijing Orient Agribusiness Consultant.
The firm said it has not received the test results, and were still verifying the news.
The cancer-causing aflatoxin tends to form when fodder for milk cows, like corn and peanuts, are stored for a long time in poorly-ventilated places.
Domestic dairy companies were badly hit after melamine was found in milk products in 2008.
In December 2011, food items of leading dairy producer Mengniu were also found to contain aflatoxin.
China presents huge potential for milk powder consumption, with 16 to 20 million new births annually.