Danone has reacted strongly against the accusation leveled by Russian Agriculture Minister Nikolai Fyodorov that the French Dairy firm is selling adulterated products that contain cheap ingredients.

On Friday, Fyodorov criticized the quality of dairy products manufactured by multinational firms, referring to dairy firms Danone and PepsiCo-controlled Wimm-Bill Dann, reports 3news.co.nz.

On Satruday, Danone, which is a major investor in Russia, posted a statement 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 minister on a visit to dairy plant in the Siberian city of Omsk was quoted as saying by the Interfax news agency: "There is only 10-20 per cent of milk left in such dairy products, the rest is vegetable oils."

He also told regional governors to monitor the the activities of large dairy companies.

The company, which claimed that it pays billions of rubles in taxes to Russia, demanded withdrawal of this statement.

Danone has been in Russia for more than two decades and has 20 facilities with a staff strength of over 12,000 people.

In retaliation for the Western sanctions over its actions in Ukraine, Russia has imposed a ban on import of foods such as dairy products.