Synlait Milk is to double manufacturing capacity at its Dunsandel lactoferrin plant after concluding a long term sales deal for the product.
It will allow investment worth $18 million to expand the plant.
Synlait's managing director, John Penno, wouldn't give details of the deal, which he said were confidential, but he said it was with an international company and would last for many years.
"Our investment decision to double our lactoferrin manufacturing capacity is underpinned by three factors: a strengthening global market for lactoferrin, growing internal demand for our own infant formula manufacture and a secure portfolio of reputable lactoferrin customers," Mr Penno said.
Lactoferrin is an iron-binding protein within human metabolism, and is recognised for its anti-bacterial and anti-inflammatory properties.
As a naturally occurring milk protein, it is being more frequently used in infant formula products, particularly in China.
The expansion to Synlait's lactoferrin facility is expected to be completed by October 2018.