Some €35m is being invested by the government and a number of industry partners in two dairy processing innovation facilities.

The bulk of the money will go towards the establishment of a Dairy Processing Technology Centre, hosted by the University of Limerick.

The remaining €10m will be invested by Teagasc, and the dairy industry shareholders, in the expansion of facilities at the Moorepark Technology Ltd (MTL) in Fermoy, Co Cork.

It comes ahead of the lifting of dairy quotas for the first time in three decades in the coming months, when farmers will ramp up production.

It is hoped the investment will help to maximise the growth created by an anticipated increase of 50% in the Irish milk pool by 2020.

Of the 10 major dairy companies involved, seven are investing in both initiatives.

Announcing the investment, Agriculture Minister Simon Coveney said: "Ultimately, this kind of investment can build the kind reputation for excellence in all things dairy that creates a platform not only for export growth, but also for inward investment by major global players in the food industry."

"This exactly the kind of initiative envisaged in Food Harvest 2020 and I am delighted to be associated with it," he added.

While Jobs Minister Richard Bruton said: "Clearly the removal of milk quotas offers huge opportunities that we must exploit in a planned and strategic way in order to support jobs growth."

The news comes as figures show Irish people are consuming less dairy.

Domestic milk intake was down 17.1% in December last year, while butter production was also down 1.8% to 5,400 tonnes.

The Dairy Processing Technology Centre consortium involves eight companies: Arrabawn Co-op, Aurivo, Carbery, Dairygold, Glanbia, Kerry, Lakeland Dairies and Tipperary Co-Op - as well as nine research providing organisations: University of Limerick (host) and Teagasc, UCC, UCD, TCBB at NUIG, DCU, TCD, DIT, ITT and CIT.