French dairy giant Danone has reacted angrily after Russia’s agriculture minister accused it of adulterating its products with cheap ingredients, demanding a retraction of what it called a slanderous claim.

Russian Agriculture Minister Nikolai Fyodorov on Friday slammed the quality of dairy products produced by «transnational corporations», referring to dairy giants Danone and Wimm-Bill Dann, which is controlled by PepsiCo.

Danone, a major investor in Russia, said in a statement posted late Saturday on its website: «We, Danone Russia and all our staff are deeply insulted by this statement. We are not only outraged by such statements from an official but view them as a direct slander, causing harm to our reputation both in Russia and in the whole world.»

The Russian agriculture minister claimed that large international producers «buy milk on the cheap and add palm oil and turn it into a ‘dairy product’, deceiving all of us.»

«There is only 10-20 per cent of milk left in such dairy products, the rest is vegetable oils,» Fyodorov said while visiting a dairy plant in the Siberian city of Omsk, quoted by the Interfax news agency.

He also told regional governors to keep an eye on the activities of large dairy producers and «not let them ‘skim the cream’ off the cheap raw product that our poor peasants produce.»

Saying that it pays «billions of rubles in taxes to Russia’s budget», Danone demanded «a public retraction of false information that slanders us.»

Danone said it has worked in Russia for more than 20 years and has 20 factories in the country with more than 12,000 staff.

Russia has imposed an embargo on imports of most foods from Western countries, including dairy products, in retaliation for sanctions over its actions in Ukraine.

afp.com