The Radio Australia, September 19, 2008-

Reports in the Chinese media suggest the company at the centre of a contaminated milk scandal knew it had a problem as far back as 2005.

Our correspondent Kerri Ritchie reports, more than 6,000 children in China are sick and four babies have died after drinking milk laced with melamine.

Chinese media is reporting dairy company Sanlu knew its products were contaminated three years ago but kept quiet.

Sanlu’s chairwoman has been sacked along with a number of government officials.

New Zealand dairy giant Fonterra part-owns Sanlu.

Fonterra knew about the crisis six weeks before it went public.

New Zealand trade minister Phil Goff doesn’t believe Fonterra’s representatives at Sanlu should be arrested but he says Fonterra should learn some lessons.

“China is a market of huge opportunity but it’s also a market which operates quite differently from New Zealand,” he said.

Fonterra says it’s now doing all it can to make things right.

Meanwhile, the Chinese government quality watchdog says nearly 10 per cent of milk samples taken from top Chinese dairy companies was contaminated by melamine.

The nationwide inspection of milk showed the problem of contamination ran wider than the tainted milk powder that has made thousands of infants ill.

Officials said most milk was safe to drink, trying to bolster public trust already rocked by a litany of food scares involving eggs, pork and seafood in recent years.

The General Administration of Quality Supervision, Inspection and Quarantine says almost one-tenth of milk batches from Mengniu Dairy and Inner Mongolia Yili Industrial Group Co Ltd tested positive for melamine, a compound banned in food.

At the latest count, 6,244 children have fallen ill with kidney stones after drinking powdered melamine-tainted milk, with four deaths and 158 suffering “acute kidney failure”.

– Original: The Radio Australia