Fonterra to build two more dairy farms in China

Fonterra, the multinational dairy company owned by 13,000 New Zealand dairy farmers, has signed an investment agreement with Yutian County in Hebei province to develop two more large-scale dairy farms.

Kelvin Wickham, president of Fonterra China and India, said the move is the latest in a plan to create a hub of five farms in the province, aimed at building “a high quality, sustainable fresh local milk supply in China”.

The two farms, 120 kilometers east of Beijing on an 80 hectare site, will house around 3,350 milking cows each and collectively produce up to 65 million liters of milk a year once fully operational, added Wickham.

The herd will be made up of China-born cows bred on Fonterra’s other farms, supplemented by around 4,300 cows shipped from New Zealand.

Experts say the demand for dairy in China is expected to double by 2020 and much of the growth will be met by local production.

“We need to build a safe, sustainable local milk supply to feed this growth,” Wickham said.

Nicola Morris, general manager of Fonterra China Farms, said once fully operational, the hub is expected to produce around 150 million liters a year.

“We intend to follow this farming hub with several more through China, with the ultimate goal of producing up to 1 billion liters of high quality milk by 2020,” Morris said.

The double site will operate as two farms, with separate 50 bay parallel milking parlours and cow barns.

However, they will share common facilities such as workshops, feed mixing areas, effluent treatment and staff accommodation to maximize the efficiency of the operation, she said.

Construction will start next month and the farm is expected to open by October 2013.