A Chinese-Russian joint venture plans to build a 100,000-cow dairy farm in northern China, but one analyst has serious doubts the project will achieve such a scale.

Last week, officials in Heilongjiang Province announced construction had started on the project, backed by a Russian company Severny Bur, better known for producing mining equipment, and Chinese company Zhongding Dairy Farming.

Construction has already started on the project in Mudanjiang, a city of two million people.

Russia has imposed an embargo on a range of goods, including dairy, that it traditionally imported from the West, forcing companies and officials to look to alternative suppliers. There are also sanctions preventing EU farmers selling goods to Russia, imposed in the wake of the MH17 disaster.

The announcement has raised alarm among European Union dairy farmers, who fear once the massive dairy is built they will lose a valuable market for their goods.

The chairman of the European Union farming umbrella group, Milk Working Party Copa-Cogeca, told UK publication Farmers Weekly that if the dairy did reach full scale it could produce 800 million litres of milk each year.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 4 minutes 28 seconds 4 m 28 s ChinaAg founder Loren Puette explains why he doubts plans to build a 100,000-cow dairy farm in northern China will ever achieve that scale. ( Clint Jasper ) Download 2 MB

Last year, all the dairy farmers in Tasmania produced a similar amount.

But Chinese food industry and agribusiness expert and founder of the market intelligence website ChinaAg, Loren Puette, said the location of the dairy could help ease an oversupply of Chinese animal feed, like corn, in the region.

China is also trying to streamline its dairy industry, which has many small and medium enterprises, which officials would like to see become three to five major operations.

Modern Dairy, with 40,000 head of cattle, is currently the largest operation in China, so, if completed, the new project would be more than double the size.

But Mr Puette was sceptical about the project's ability to achieve that kind of scale, saying it might be more about sending a message to Europe than milking cows.

"In my personal opinion, I think this has been designed partly to impact public opinion, to give Russia a playing card when negotiating with the EU," he said.

"Whether that will be carried out or not remains to be seen, but if it does it'll be a very big farm, and there should be concern it could supplant European supply."

Either way China wins

Mr Puette said it was misleading to think of deals like this and previous joint ventures like the Armada agreement as a Chinese-Russian alliance.

Every time Russia shut the door on a certain agricultural good, for example, Finnish port or Latvian canned sprouts, China welcomed the new business.

"There has been a major diversion of agricultural products away from Russia to China," Mr Puette said.

"So it's not a situation where China is hand-in-hand with Russia. They are also looking out for their interests and they are more than happy to take on European products, just as Khazakstan and Belarus are.

"Even though they are in the same customs union with Russia, they are not taking the same hard line as the Russian government."