New Zealand's Food Safety Authority is pleased a Chinese infant formula linked to Fonterra has been cleared of any contamination.
China's health ministry says it has found no evidence of contamination in milk powder, after an investigation into reports that it had caused baby girls to show signs of premature sexual development.
The ministry tested products made by Chinese baby-formula maker Synutra International as well as 20 other brands across the country to compare the level of oestrogen in dairy products.
The probe focused on three cases in Wuhan, in central China's Hubei province, as well as six cases in five other provinces.
The Ministry of Health experts' group found no relationship between the premature development of breasts in the three infants in Hubei and Synutra milk powder, and discovered no abnormal hormone content in the Synutra milk powder or other products tested in the market.
New Zealand dairy co-operative Fonterra supplies standard whole milk powder to Synutra, which also gets milk from other sources.
Fonterra maintained that if any hormones were found, they would not have come from milk powder that it supplied as there is a ban on the use of hormonal growth promotants in dairy cows in this country.
An assistant director with the Food Safety Authority, Paul Dansted, says it is pleased that there is no evidence of contamination in the infant formula, and that it rules out any link with Fonterra.
A spokesman for China's Ministry of Health, Deng Haihua, said the early appearance of breasts was a common clinical condition and there had been no notable increase across the country.
Synutra shares plunged as much as 35% last week, but stabilised after the company denied the reports and said it was in the process of taking legal action to protect its brand.