(Yicai Global) Aug. 5 -- A new joint venture between Coca-Cola and China Mengniu Dairy, one of the country’s largest dairies, will establish a low-temperature milk project with a total investment of CNY2.1 billion (USD302.1 million) in China’s central Anhui province.

The products will be available next year at the earliest, the government of Wuhe county, where the project is located, said in a press release yesterday.

Coca-Cola and Mengniu will run the project and will invest in new specialized equipment for the Wuhe county ranch of Mengniu-backed China Modern Dairy to produce and sell high-end, low-temp milk. The project has four phases, with the CNY500 million (USD71.9 million) first stage expected to go into operation in the third quarter of next year. The press release did not give further financial details.

The ranch chosen by the project is said to be Asia’s largest grazing pasture. It has more than 40,000 cows imported from Australia, Uruguay, and New Zealand, that can produce over 600 tons of milk a day, according to publicly available information.

The partners secured regulatory approval to set up a JV to produce and sell low-temperature dairy products on April 29. Neither Wuhe county’s press release nor the State Administration for Market Regulation’s May announcement gave the name of the JV.

Though Coca-Cola was not previously involved in China’s dairy sector, it formed a JV with Select Milk Producers in 2012 to launch the Fairlife brand in the US. The brand sells a range of dairy-based beverages. Coca-Cola bought Select Milk Producers’ 57.5 percent stake in Fairlife in January.

Editor: Peter Thomas