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Fonterra has signed a dairy farm investment agreement with local authorities in China's Yutian County.
The agreement – forecast earlier this year by NBR ONLINE – paves the way for two more large-scale dairy farms to be developed for $100 million in Hebei province, which will complete the dairy giant's goal of a five-farm "hub".
The company says in a statement the two farms, 120 kilometres east of Beijing, will house more than 3000 milking cows each and collectively produce up to 65 million litres of milk a year.
"We intend to follow this farming hub with several more through China, with the ultimate goal of producing up to one billion litres of high quality milk by 2020,” Fonterra's president of Greater China and India, Kelvin Wickham, says.
The farms' herd will come from 4300 cows shipped from New Zealand and cows bred on Fonterra’s other Chinese farms.
Construction will start in December and the farms are expected to be open in October 20.
As reported in NBR Print today, Fonterra wants to expand its farming business in China further by building a second "hub" of five farms.
According to its prospectus, issued last week, funding options include "a wide range of potential external partners".