Maori tribe Ngai Tahu is looking to enter the dairy industry with plans to trial three sustainable farms in the South Island.
The project was approved at a meeting in Karitane last year and the first farm will be located at Eyrewell in North Canterbury.
Ngai Tahu Property head Tony Sewell says the iwi is a massive land owner in North Canterbury and dairying will be a good economic use of that land.
Ngai Tahu kaiwhakahaere (board chairman) Mark Solomon says the trial has been approved on the basis that the model will be sustainable and production will start in the next five years.
Ngai Tahu Property and Toitu Te Whenua, the iwi's environmental arm, will work together to develop the farms.
The iwi is also working with Lincoln University to create a commercial dairying model.
Federated Farmers' dairy chairman Lachlan McKenzie welcomed the announcement, saying it is great news the iwi wants to maximise revenue from the land and look at environmental issues.
Mr McKenzie says 95% of New Zealand's dairy products are exported and there is growing demand.