Dairy cooperative Fonterra has completed another step in its strategy of building a high quality sustainable milk supply in China after signing an agreement to develop two large-scale farms in the province of Hebei.
The agreement, signed with the Yutian County, completes Fonterra’s hub of five farms in the province.
The two new farms, located 120km east of Beijing on a 80-hectare double site, will house around 3,350 milking cows each and collectively produce up to 65 million litres of milk a year once fully operational.
The president of Fonterra Greater China and India, Kelvin Wickham, said the investment was part of Fonterra’s strategy to build an integrated local milk pool in China, a market that is expected to see tremendous growth in coming years.
“The demand for dairy in China is expected to double by 2020 and much of this growth will be met from local production. We need to build a safe, sustainable local milk supply to feed this growth,” he said.
“Today’s announcement completes our first farming hub in Hebei Province. Once fully operational, the five-farm hub is expected to produce around 150 million litres 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.”
The new double site will operate as two farms, with separate 50 bail parallel milking parlours and cow barns. They will, however, share common facilities such as workshops, feed mixing areas, effluent treatment and staff accommodation.
The general manager of Fonterra China Farms, Nicola Morris, said the herd will be made up of China-born cows bred on Fonterra’s other farms and supplemented by around 4,300 cows shipped from New Zealand.
Construction will commence in December this year and the farms are expected to open in October 2013.
Chinese dairy products consumption is expected to double by 2020.
