Fonterra, the New Zealand dairy products giant, signed a deal worth more than 300 million NZ dollars (235 million U.S. dollars) with China, The Press newspaper reported on Friday.

Philip Turner, Fonterra's Japan-based general manager of trade for Asia, told a New Zealand Parliamentary select committee -- hearing submissions on legislation to give effect to the trade deal-- that the contract was to supply "a major multinational customer" with nutritional milk powders.

Turner said the "commercially very valuable" deal came within weeks of the signing of the China-New Zealand free trade agreement in early April.

"We've been able to conclude a deal recently on the basis of the FTA being signed, which results in a considerable volume of business and processing being done in New Zealand that would otherwise have gone offshore, in this case to Singapore," The Press quoted Turner as saying.

Fonterra's written submission said the deal would generate more than 300 million NZ dollars in revenue over four years.

"These value-added dairy products will be manufactured in New Zealand factories, using New Zealand milk, capital, labor and technology," it said.

"Without the FTA with China, lower-priced product from New Zealand would almost certainly have been processed offshore in Asia."

Trade Minister Phil Goff welcomed the news, saying "Fonterra's submission to Parliament, and its announcement of this deal only weeks after signature of the FTA, is further evidence of the value of that outcome to New Zealand."

China is New Zealand's fourth-largest export market for dairy products.

The phase-out of tariffs on all dairy products under the deal over the next five to 12 years will save Fonterra 56 million NZ dollars on current export values.