The maker of popular hazelnut spread Nutella is battling claims that a main ingredient of the product causes cancer.

Reuters reported that Italian food maker Ferrero recently launched an advertising campaign in Italy to assure customers that the palm oil used in Nutella is safe for consumption.

"Making Nutella without palm oil would produce an inferior substitute for the real product, it would be a step backward," Ferrero's purchasing manager Vincenzo Tapella told Reuters. 

Ferrero uses about 185,000 tons of palm oil a year. Using substitutes could cost the company an extra $8-22 million annually.

"The palm oil used by Ferrero is safe because it comes from freshly squeezed fruits and is processed at controlled temperatures," Tapella says in a TV ad, filmed at the firm's factory in the northern Italian town of Alba and was accompanied by full-page ads in newspapers.

The European Food Safety Authority released a study that found palm oil generated more of a potentially carcinogenic contaminant than other vegetable oils when refined at temperatures above 200 degrees Celsius. 

The agency did not recommend that consumers stop eating it and said further study was needed to assess the level of risk.