Irish dairy giant, Glanbia, is negotiating with Dairy Farmers of America and Select Milk Producers to build a $170m cheese and whey production facility in Western Texas, US.

If the project goes ahead, building will begin from the summer 2005. Glanbia chief executive John Maloney, said: “This project will be a significant step forward in the implementation of our growth strategy.

“It will position us as the number one producer of American-type cheddar cheese in the US.”

The new facility will process over 1bn litres of milk and produce 115,000 tonnes of cheese and 7,500 tonnes of high value-added whey proteins and generate around $340m a year.

DFA marketed 21.7bn litres of milk during 2002 - 28.2% of total Stateside milk production.