Westland Milk Products has found traces of DCD in some of its goods.
The company commissioned tests through an independent laboratory after the compound was found in some Fonterra products.
The tests revealed minute traces of DCD in samples of Westland products produced before November 1 last year. The evidence indicated products made after that date are free from DCD, the company said.
Westland is conducting further testing in line with customer and government requirements and said it would announce the results as soon as possible.
"While we are assured by independent health authorities and the New Zealand Government that DCD is not a food safety risk we are very aware that for many of our customers any residue in milk products is undesirable,'' said Westland chief executive Rod Quin.