BILLIONAIRE mining mogul Gina Rinehart is about to become Queensland’s dairy queen with a massive initiative to supply milk powder to China.

Australia’s richest person is investing $500 million in a joint venture with Chinese interests to produce baby formula for the world’s biggest population.

The new company — named Hope Dairies after the tycoon’s mother — is buying up 5000 hectares of dairy farms in the South Burnett region — and in the Mary Valley area where the Traveston Dam project was abandoned and plans to build a processing plant nearby.

It is the biggest investment in the state’s dairy industry in 20 years.

Queensland Dairyfarmers Organisation president Brian Tessmann welcomed the move as ‘’a show of real confidence’’.

He told ABC Rural: “The investment would restore dairy processing capacity which Queensland has lost over the last decade and a half.

“We hope it will provide a range of opportunities for our existing Queensland dairy farming families, which have suffered greatly in recent years from natural and man-made disasters including the supermarket mile price war and drought.

“We have lost over 130 farmers since the price war started.

“It is clear that Chinese consumers value our high quality dairy products, which is in stark contrasts to Australia, where the major supermarkets are happy to devalue our fresh milk as a discount marketing agent.’’

Ms Rinehart’s Hancock Prospecting is believed to have partnered with the state-owned China National Machinery Industry Corporation.

A memorandum of understanding between the companies at the Queensland Government is due to be signed at the G20 in Brisbane this weekend.

The dairy operation will be among the country’s largest and expected to export up to 30,000 tonnes of milk powder a year.

Hope Dairies spokesman Jason Morrison (told the ABC) said the new company would supply infant formula to China from late 2016.

“It’s processing, it’s canning, it’s exporting, right down the marketing of it.

“Gina Rinehart has had a lifelong association with the agriculture industry and she has teamed up with a great deal of expertise in Queensland to build another export industry with huge potential for Australia.

“Australia’s reputation and the Queensland dairy reputation is incredible,’’ he said.

The business will benefit from the Free Trade Agreement nearing completion between Australia and China which will remove tariffs on exports.

New Zealand, which already has an FTA with China, supplies much of the country’s infant formula but already-huge demand is tipped to double within three years after China lifted its one-child policy.

The venture also represents a major commitment to Queensland’s potential as a food bowl to supply the rapidly growing middle-class in Asia.

It comes just days after reports that the federal Government is nearing an agreement for the export of up to one million live cattle a year to China.

Ms Rinehart, whose fortune is estimated at $20 billion, has also bought cattle properties in the Kimberley.