China toxic milk powder kills 3, thousands sick

By Chris Buckley

BEIJING (Reuters) - China said on Wednesday a third infant had died after drinking contaminated milk and the number sick had leapt to many thousands, while an official said the health threat was concealed for at least a month.

The number of children ill after drinking powdered milk laced with the compound melamine had risen nearly five-fold to 6,244, and those with "acute kidney failure" had reached 158, Health Minister Chen Zhu told a news conference.

The escalating scandal triggered a recall of exports, sacking of officials and detention of a sacked company executive.

"China's dairy industry has been pushed to the brink of outright crisis," said Li Zhiqi, a Beijing-based consultant who works with dairy companies.

A government probe announced on Tuesday showed a fifth of 109 dairy producers checked made batches of products adulterated with melamine, which is banned from use in foods.

Earlier this week, officials said 1,253 children were ill and two had died after the country's biggest baby milk powder maker, the Sanlu Group, last week revealed its products contained melamine, which can be used to bamboozle milk quality checks.

Melamine is rich in nitrogen, used to measure protein, and so can be used to disguise diluted milk. It can cause kidney stones and other organ problems. Four suppliers have so far been arrested for selling melamine-laced milk to Sanlu.

The scare has rippled beyond the nation's borders with China's quality watchdog saying two producers were recalling milk powder exported to Yemen, Bangladesh, Myanmar, Gabon and Burundi. Officials did not say whether those exports were contaminated.

Taiwan, the self-governed island claimed by China, issued a ban on all dairy products from 22 mainland companies.

China's products have suffered repeated scandals involving toxins and flaws in recent years, and this is not the first involving melamine, usually used to make plastics, fertilizers and cleaning products. In 2007, the U.S. government found pet food ingredients from China tainted with melamine.

The new scare, with claims of an official cover-up, has again shaken investor and consumer confidence. Sanlu was among seven dairy companies counted so safe it was excused from normal government quality checks.

Facing widespread public alarm, minister Chen urged hospitals to prevent further deaths.

"As far as possible, minimize the harm to infants' health from the contaminated milk powder," he said.

China is the world's second-biggest market for baby milk powder, and Sanlu has long dominated it. Based in Shijiazhuang, capital of the north Chinese province of Hebei, it is 43 percent owned by New Zealand dairy giant Fonterra.

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