Wal-Mart said Thursday it no longer imports fish from a Chinese factory that employed North Koreans after a report said the US retailer may have inadvertently subsidized the nuclear-armed state.

Wal-Mart barred suppliers from using fish from a facility in Hunchun, one of several in the eastern Chinese city that were reported to employ North Korean laborers in slave-like conditions.

Wal-Mart gave the Hunchun facility a "red" rating after it did not cooperate with a company investigation into labor problems, said Wal-Mart spokeswoman Marilee McInnis.

"The welfare and dignity of workers is very important to us, and we are working in several ways to help combat the use of forced labor in global supply chains," McInnis said in an email.

"We have a system in place to assess suppliers' disclosed factories for compliance with our standards and take appropriate action when we do identify issues that need to be addressed."

"Combatting forced labor is a complex problem that no one company, industry, or government can tackle alone," she said, adding Wal-Mart was working with industry groups, governments, other retailers and NGOs to "create lasting, sustainable change."

Conditions under which North Korean laborers work at the plant were uncovered in an investigation by the Associated Press.

German supermarket chain Aldi, which the article said also has imported seafood from Hunchun factories employing North Koreans, did not respond to questions from AFP.

American companies and companies that operate in the US are barred from doing business with North Korea or with people from the country

AP said Hunchun was part of a broader effort by Pyongyang to disperse tens of thousands of workers around the world in various industries, bringing in an estimated $200 to $500 million annually and bolstering North Korea's nuclear program.

Shipping records showed that more than 100 cargo containers with more than 2,000 tons of salmon, snow crab and other fish were sent to the US and Canada from factories where North Koreans worked, AP said.

Workers at the plant are not allowed to leave the compounds without permission and have no access to telephones or email. As much as 70 percent of their pay is taken by the North Korean government, the article said.

In late September, the US Treasury Department imposed sanctions on eight North Korean banks and 26 executives, targeting North Koreans working as representatives of North Korean banks in China, Russia, Libya and the United Arab Emirates.

The sanctions were the latest in a series of penalties by the US and the United Nations aimed at choking off Pyongyang's nuclear program. (AFP)