Fonterra, the world's biggest dairy exporter, said three batches of its whey protein had been contaminated with , which can cause botulism, which affects the muscles and in serious cases can cause respiratory failure.

Forty tonnes of whey protein had been contaminated, according to New Zealand's Ministry of Primary Industries. The whey concentrate found its way into nearly 900 tonnes of other products, the ministry's acting director general, Scott Gallacher, said.

Fonterra said most of the protein was sold to eight manufacturers to make their own products - three food companies, two beverage companies and three animal feed firms.

Fonterra said those firms would initiate any consumer product recalls.

Chinese newspaper reported three of the customers were based in China.

New Zealand authorities have contacted officials in Australia, China, Malaysia, Thailand, Saudi Arabia and Vietnam.

So far, the only product the ministry has identified as problematic is the Nutricia Karicare follow-on formula, which is popular in China. Nutricia said none of the affected batches had got to supermarket shelves.

Fonterra chief executive Theo Spierings is flying to Beijing this weekend from Europe to discuss the matter.

The General Administration of Quality Supervision, Inspection and Quarantine said it had asked New Zealand to take immediate measures to "prevent the products in question from harming the health of Chinese consumers".

Fonterra said the contamination was the result of unsanitary pipes at a factory in Waikato, New Zealand, and was identified in March. But it did not disclose the "potential quality issue" until the most deadly strain of the bacteria was discovered last week.

Chen Lianfang, a dairy industry analyst with Beijing Orient Agribusiness Consultancy, said Fonterra was China's largest supplier of imported milk.

The announcement comes as Fonterra is planning to launch its own branded milk formula in China, five years after its involvement in a scandal in which melamine-tainted infant formula killed at least six babies and made 300,000 ill. Fonterra previously held a 43 per cent stake in Sanlu Dairy, the company at the centre of the crisis.

Professor Wei Ronglu, of the Western Dairy Development Association, said China should improve its dairy industry instead of relying on imported products.

"If the government had done a better job, Chinese consumers would not be so miserable depending on overseas products."

The incident prompted shock and criticism in the country. Liu Kai, a mother in Beijing with a three-year-old boy, relies on foreign formula powder. "I thought only Chinese producers would do such things," she said. "It's way too late to tell us now. Most of the problematic products might have been used already."

Unhappy about the popularity and high price of foreign dairy products, Beijing launched an anti-trust probe in June, forcing foreign brands, Fonterra among them, to lower their prices.