Fonterra, a New Zealand-based dairy co-operative, has entered into an agreement with Abbott Laboratories to develop a new dairy farm hub in China.
According to Fonterra, the move comes in response to the growing demand for quality milk in China.
Both the companies plan to invest around NZD342m ($300m) in the proposed dairy facility through a joint venture, after securing regulatory approval.
The dairy farm will have a capacity to produce around 160 million liters of milk annually and will house five dairy farms. It will have more than 16,000 dairy milking cattle for the production of milk.
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.
The first farm in the hub will be completed and begin producing milk in the first half of 2017, while the remaining farms will become operational in 2018.