Milk powder contaminated with a chemical used to make plastics has sickened more than 1,200 infants in a health scare that erupted last week and prompted a nationwide investigation into the extent of the problem.

The contamination was originally thought contained to the Sanlu brand, with the company apologising on Monday for the scandal.

But state-run CCTV said Tuesday night that more products have been discovered with the chemical melamine, and that all, including the powder made by Sanlu, have been pulled from shelves.

"In order to ensure the safety of the milk products, the relevant government departments have pulled them from shelves, sealed them, recalled them and destroyed them," CCTV said in its report.

The State Administration of Quality Supervision, Inspection and Quarantine said tests on products from all 109 baby milk companies in China showed varying traces of melamine in 69 batches from 22 companies, Xinhua news agency said.

In an indication, meanwhile, that markets outside mainland China could be affected, a Hong Kong supermarket chain on Tuesday recalled a yogurt ice bar found to contain melamine.

The Wellcome chain said the product was the Yili Natural Choice Yogurt Ice-bar. Yili is a dairy manufacturer in China's Inner Mongolia region.

The scandal is the latest to rock China's food industry, which has been tarnished by a series of health scares over dangerous products, including those to export markets, in recent years.

China's top product-quality watchdog would dispatch inspectors to all milk-product manufacturers to contain the spreading health threat, CCTV said.

The moves were meant to "uncover the causes, pursue those responsible and severely deal with them in accordance with the law," it said.

The government has said milk collectors, who gather milk from dairy farmers, deliberately added melamine to make it appear the milk had more protein.

Sanlu, however, had blamed dairy farmers.

Police have arrested four suspects, at least two of which have admitted adding melamine to milk, according to state press, in reports that warned more sick babies were expected to be reported.

The 22 companies mentioned by CCTV included Torador Dairy Industry, a China-Australia joint venture in the northern city of Tianjian. Calls to Torador on Tuesday evening went unanswered.

They also included Guangdong Yashili Group, the report said, which exports its products to Bangladesh, Myanmar and Yemen.

However, it said tests of Yashili export products showed no melamine traces. The report made no further mention of possible contamination of exports.

Melamine, which is used for making plastics and glues, is being blamed for causing kidney stones in the affected babies, a condition normally rare in infants, but which gives rise to a range of health risks.

The two infant deaths occurred in May and July, the health ministry said.

The government has criticised Sanlu for not going public sooner once babies began to fall ill in March in northwestern Gansu province.

Tests in early August began to show melamine in Sanlu's product, but the scandal only broke in Chinese media last week.

Sanlu has fired its chairwoman and its general manager, state media said.

Four local officials, linked with agriculture and quality control, were also sacked on Tuesday, Xinhua said.

Andrew Ferrier, the head of New Zealand dairy giant Fonterra, which owns 43 percent of Sanlu, said Fonterra knew of the contamination in early August and pushed for an immediate recall but that Sanlu was slowed by Chinese rules.

New Zealand Prime Minister Helen Clark said her government learned of the contamination problem September 5, then "blew the whistle" three days later by informing Beijing after local Chinese officials refused to act.

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