Inner Mongolia Natural Dairy has purchased two farming hubs for just over 500 million, and another farm's sold for 42 million.
Fonterra CEO Miles Hurrell says it will let the co-op prioritise areas where they have a competitive advantage.
China Studies Centre director Antje Fiedler says Fonterra is heavily involved in product development throughout China and South East Asia.
She says one example is working with chefs to create cake products that specifically use New Zealand butter.
