Fonterra said it plans to build two new milk powder driers at its Studholme site in South Canterbury.
The co-operative said it had started a consultation process with a view of lodging consent applications for the driers, which it expects to build in the next five to 10 years.
The proposed investment would bring a significant boost to milk processing in South Canterbury - one of New Zealand's fastest growing dairy regions - with around 9 million litres of additional capacity to help keep pace with rising milk volumes.
Fonterra's managing director of global operations, Robert Spurway, said: "Should it go ahead, the investment at Studholme will bring much needed processing capacity to the South Island as well as optionality to make the products that bring the greatest returns to our shareholders."
The expansion, if approved, would start with construction of the first drier within the next five years, followed by the potential installation of a second drier within the next 10 years. With each new drier the site and tanker staff would grow by around 125 new positions.
