The group has been selling the counterfeit product across seven provinces in China, marketing it as the popular US brand "Similac," Shanghai officials said.

All of the dodgy goods had been traced and seized by the end of last year, the producer of "Similac," Abbot US, said in an online statement on Tuesday.

The Chinese authorities said that the mixture posed no safety risk.

According to the state media, the suspects used the same repackaging system to trade adult milk powder, selling over 17,000 tins in total. The group reportedly made nearly 2 million yuan ($309,000 or 272,000 euro) by peddling to retailers across China.

Death by melamine

This is only the latest in the series of scandals involving food safety in the world's most populous nation. Last month, a Chinese court sentenced ten people to prison terms for selling fake beef jerky. The gang used flavoring and pigment to make pork appear more like beef, according to the officials Xinhua agency.

In a widely publicized scandal in 2008, six infants died and hundreds of thousands fell ill after consuming tainted milk powder and other dairy products. A number of companies were found to be selling watered-down milk with added melamine, an industrial chemical, to boost protein levels.

The chemical caused kidney stones and renal failure, harming mostly young children.

Two men were executed and four others sentenced to life in prison for their involvement in the production process.