WELLINGTON/SYDNEY - New Zealand's Fonterra said on Monday it was recalling  products distributed in the country that had been contaminated with the E.Coli bacteria in the second food-safety scare faced by the company in less than six months.

The dairy co-operative said it was recalling 8,700 bottles of fresh cream marketed under its Anchor brand with a 'best before date' of January 21, 2014 and which were distributed to retail and food service outlets around New Zealand's North Island.

Cream sold under the Pams brand, owned by New Zealand's Foodstuffs distributor and retailer, was also included in the recall.

"We are sorry for the inconvenience and concern this recall might cause, but food safety and quality are our top priorities," Fonterra said in a statement.

The recall comes after Fonterra, the world's largest dairy processor, in August said that one of its ingredients used in infant milk formula, sports drinks and other products contained a potentially fatal bacteria, triggering recalls in Asian countries including China.

Further testing showed the initial finding was a false alarm.

Fonterra said that regular testing at its Takanini site in Auckland had shown that the cream manufactured last Monday had high levels of coliform, a bacteria found in the intestines of warm-blooded animals, along with plants, soil, air and water that can indicate the possible presence of E.Coli.

Further test results released on Monday confirmed E.Coli contamination.

"A small amount of the product had gone on to the market, but the rest of the product we immediately put on hold and today we decided to recall the products on the market, based on the further testing" Peter McClure, managing director of Fonterra Brands NZ, told Reuters.

Most strains of E.Coli are harmless, although several are known to produce toxins that can cause diarrhoea. One particular E.Coli strain called O157:H7 can cause severe diarrhoea and kidney damage.

Fonterra had no reports of illness caused by consuming the affected product so far, McClure said, adding that it was unlikely that other products manufactured at the sight were at risk of contamination.

"We tested batches before and after this particular one and they're both absolutely clear. We've sent retained samples for further testing, but we're very confident there are no further issues," he said.

The latest food safety issues come a week after France's Danone announced it was suing Fonterra for compensation after the French food manufacturer recalled its infant formula brands in Asian countries including China and New Zealand.