New Zealand company Happy Valley Milk Ltd is proposing a $200 million dairy factory for Otorohanga.

A $200 million dairy factory is proposed for a King Country town, creating 50 to 60 jobs.

Otorohanga District Council has accepted a resource consent application from Happy Valley Milk Ltd (HVM) to establish a nutritional plant.

The factory would be located on the corner of State Highway 31 and Redland Road, Otorohanga.

Otorohanga Mayor Max Baxter said the proposed dairy factory would create 50 to 60 jobs in the district, not counting construction jobs.

HVM shareholder representative Randolph van der Burgh said the New Zealand company has a focus on high-value nutritional milk powder products using A2 and organic milk.

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The development would include two 8-tonne-per-hour dryers.

The first dryer would be for A2 milk collection and, depending on demand, the second dryer would have an organic focus, van der Burgh said.

HVM has investors from New Zealand, Australia, Hong Kong and Singapore.

"We're a New Zealand entity that will put together a New Zealand independent milk powder supply chain collecting milk from independent farmers and producing consumer-ready products for export markets."

Otorohanga is a forward-looking region, van der Burgh said.

"They've got a forward-looking mayor and council, who have the right attitude.

"It's a strong dairy region with a lot of A2 herds in the catchment area."

The factory is estimated to cost around $200m, van der Burgh said.

"Between 50 and 60 jobs will be created to operate the plant, plus construction.

"We are going to be a part of the community for a long time."

He said HVM has done a lot of initial consultation with all parties and this process will continue.

"You're never going to get 100 percent of people happy, but we want to get close to that."

He hopes the factory will be up and running by the 2018 milking season.

Otorohanga Mayor Max Baxter said as well as employment opportunities, the factory would create opportunities for support businesses, too, although, some in the community have expressed concerns over the development.

"The establishment of any business can make people unhappy.

"There have been concerns about the visual impact on a viable town and community with the presence of a large factory."

The resource consent submission process will canvass those opinions.

"We are always looking for growth opportunities in a rural town, but it can't be at the expense of the community at large."

Last year, Otorohanga was set to welcome an $80m dairy factory.

Chinese investors from He Run International Investment signed on with three Kiwi investors for the factory, which would have produced high-value infant formula and specialty products, such as cheese.

However, minority shareholders confirmed the plans went cold following the stockmarket crash in China – causing the Chinese investors to pull the plug.

Council chief executive Dave Clibbery said the previous proposal did not reach the stage where a resource consent application was submitted, since overseas investors withdrew support.

"Yes, there was a proposal for a somewhat similar factory last year, though at a somewhat different location."

The current proposal is from a different set of investors, he said.

"It is unknown how the current economics of the dairy market may affect the project," Clibbery said.

The Otorohanga District Council has assessed the application and determined that it is to be processed on a publicly notified basis.

The application was publicly notified on December 7.

Submissions can be made in writing to the Otorohanga District Council and must be received before 5pm on Friday, January 27, 2017.