Australian packaging company Orora has secured a contract from dairy firm Fonterra to supply multi-walled dairy bags.
The company will increase its manufacturing capacity in order to supply dairy bags to Fonterra's New Zealand milk powder operations.
Orora will construct a A$20m ($15.25m) dairy bag production line that will be supported by the purchase of a dairy bag making machine, which deploys digital pasting of bags and the latest tube-sealing technology.
The new machine is expected to become operational in the second half of 2016.
Upon completion, the new production line is claimed to be one of the world's leading facilities with the latest bag-making technology combined with the highest food safety standards.
Orora managing director and CEO Nigel Garrard said: "Long-term investments and contracts such as this demonstrate our commitment to invest in initiatives for our customers and to drive innovation across Orora."
Based in Melbourne, Orora was formed in 2013 after packaging company Amcor demerged its Australasian and packaging distribution businesses. It is currently divided into two business segments, Orora Australasia and Orora North America.
Orora employs 5,500 people across seven countries and produces corrugated boxes, folding cartons, recycled paper linerboard, glass bottles and jars, multiwall paper sacks, closures, aluminium beverage cans, bulk bags, packaging design and testing services and recycling services.