Fonterra, a New Zealand-based dairy co-operative, has signed an agreement with Abbott Laboratories to establish a new dairy farm hub in China.
The move comes in response to the growing demand for quality milk in China.
Both the companies have announced plans to invest around $300m in the proposed dairy facility through a joint venture, after securing regulatory approval.
The hub will house five dairy farms and will have more than 16,000 dairy milking cattle for the production of milk.
The first farm will begin producing milk in the first half of 2017, while the remaining farms will become operational in 2018.
According to Fonterra, the facility is anticipated to produce around 160 million liters of milk annually.
Fonterra chief executive Theo Spierings said that the proposed dairy farm hub will be the third of its type in China.
"Farming hubs are a key part of our strategy to be a more integrated dairy business in Greater China, contribute to the growth and development of the local Chinese dairy industry and help meet local consumers' needs for safe, nutritious dairy products," added Spierings.
