World Health Organisation (WHO) experts also found evidence of the Severe Acute Respiratory Syndrome (SARS) coronavirus in wild animal markets in Guangzhou, the capital of the southern Guangdong province.
However, Robert Breiman, head of the WHO team, said the animal has not yet been confirmed to be the source of SARS.
"It doesn't prove anything, but it showed that the civet cats carried the virus," Breiman told reporters on Friday.
Health officials said that Guangdong - where China's one confirmed and two suspected SARS cases have emerged - would permanently ban trade and consumption of civet cats.
"The Guangdong government is very determined to strictly regulate civet cats - no catching and consumption will be allowed. It should be a permanent decision
"The Guangdong government is very determined to strictly regulate civet cats - no catching and consumption will be allowed.
"It should be a permanent decision," Xu Ruiheng, deputy director of the Guangdong centre for disease control, told a news conference.
The government had ordered a cull of civet cats after a 32-year-old television producer contracted the disease in Guangzhou.
It was the first case since the SARS epidemic was declared over last July.
The two other suspected cases, one a 20-year-old waitress in an exotic game restaurant, have yet to be confirmed.
Authorities had closed animal markets and cracked down on trade in wild game, which scientists say is a reservoir of disease, at the height of the SARS outbreak last year.
Robert Breiman of the WHO has
warned against taking things easy
However, the markets reopened within a few months.
Zhong Nanshan, head of the Guangzhou Respiratory Disease Research Intstitute, said a survey showed that 70% of civet cats carried the SARS virus while 40% of game traders carried SARS antibodies.
Chinese officials and Breiman also said that rats could have a role in transmitting the virus but tests are still underway and no conclusion could be drawn for now.
The cases in Guangzhou all had relatively mild symptoms compared to sufferers of the last outbreak, but Breiman warned against taking things easy.
"Is this a variant of SARS? Is it less lethal? These questions will have to be resolved in labs later on," he said.
Some researchers in Hong Kong studying samples from the three patients have described the virus as a new strain.
The SARS episode in Guangzhou has been overshadowed by a bird flu now ravaging parts of Asia, which has caused three deaths in Vietnam.