The West Coast's dairy co-operative has taken yet another step into the Canterbury patch with plans to build a three-dryer milk processing plant.

Westland Milk Products' planned first processing plant will be its first outside of the West Coast.

This will no doubt raise the ire of dairy giant Fonterra as for a decade there was an unspoken boundary of the Southern Alps dividing the eastern territory for it with the west reserved for the Hokitika-based co-operative.

That was broken when Westland set up an office and transport hub in Rolleston and took on Canterbury milk suppliers and its growing presence is now set to extend to this planned nutritional products plant to match its Hokitika factory.

Westland has begun applying for resource consents for the site in its ambition to market more added value dairy-based nutritional products to give a better return for its shareholder farmers on both sides of the Main Divide.

The co-operative has yet to put a figure next to its new site, but Fonterra is investing $500 million in a two-stage complex at Darfield which will include the world's largest 30 tonne an hour dryer.

Subject to consents being granted, Westland will process raw milk into nutritional milk products such as infant formula, and growing-up milk powders, for domestic and international markets.

Nutritional foods are expected to buffer the company against the volatility of the bulk dairy commodities market and open a wider range of high value export markets.

Westland chief executive Rod Quin said the plans indicated the confidence Westland had in the future of dairying in and outside of Canterbury.

''We expect that we will continue to expand our supplier numbers in Canterbury and if the Rolleston plant progresses, it will be of significant benefit to the local economy.''

At this stage Westland sends Canterbury milk by rail to Hokitika for processing, but the plan is to process that milk in Rolleston.

The nutritional dairy plant is expected to be built in Rolleston's Izone Industrial Park.

Quin said new jobs would contribute more than $10 million a year into the local economy.

Jobs would be created in such areas as engineering, maintenance, production and environmental management.

The site would include an extension to its railway siding for transporting milk powder.

The three milk dryers will be about 34 metres in height with a stack reaching a maximum 43.5 metres.

- © Fairfax NZ News