"We have also arranged for medical experts to discuss the conditions of the affected female babies and open an investigation to analyse the connection between the illness of the babies and the milk powder," he said.

The parents in Hubei claim milk powder caused their babies to grow breasts, state media reported.

The report said the babies, from four to 15-months-old, were found to have abnormal levels of the hormones estradiol and prolactin, which stimulates lactation, or the making of breast milk.

Tests conducted

A food safety expert for the World Health Organisation said test results are expected within days and that the agency will then take a look.

On Monday, a statement issued by Synutra quoted chairman and chief executive Liang Zhang as saying that the company is completely confident its products are safe.

Milk powder became a sensitive topic in China two years ago when more than 300,000 children fell ill and six were killed by infant formula tainted by the industrial chemical melamine.

At the time, a Chinese agency found melamine in formula made by 22 Chinese producers, including Synutra, and Synutra announced it would recall products that may have been contaminated.

That scandal led China to overhaul its food safety measures, but in several cases this year authorities have found tainted milk being used in products instead of having been destroyed as ordered.