China's dairy industry is on the move if developments in Xingtang county in north China's Hebei Province are anything to go by. Cows used to roam around rural houses there, but now they are being sent to the province's 109 new dairy farms built this year.

The county government has encouraged dairy farmers to set up the large dairy farms of at least 1,000 cows by providing subsidies worth 600,000 yuan (88,200 U.S. dollars) for each farm. As part of the agreement, the farms that get the subsidies must look after the smaller farmers' cows.

One of the farms, Kangyuan Dairy Farm, for example, has 650 cows sent by 48 small farmers.

The farm supplies milk to Sanyuan, the dairy company that took over the bankrupted Sanlu Group which not long ago was China's biggest dairy producer but suffered devastating losses being at the center of the melamine-tainted milk scandal last year.

At least six infants died and over 300,000 others suffered kidney problems and other symptoms after consuming melamine-tainted milk powder.

Melamine was added to milk in the past was to make it seem better than it really was. After melamine scandal, it is impossible to sell poor quality milk.

"We have closed 323 milk stations that collected substandard raw milk from individual farmers," said Lu Shuping, deputy director of the Animal Husbandry Bureau in Xingtang County, one of China's major dairy producing counties.

Cow farmers hope that the new unified breeding system will give them the competitive edge by fundamentally improving the quality of raw milk, said Liu Yingwu, secretary general of the Dairy Association in Shijiazhuang, capital of north China's Hebei Province.

Individual farmers are still responsible for their own herds in the new dairy farms, but the farms have standard management of feedstuff, milking and inoculation.

"I didn't pay fees for joining the Kangyuan Dairy Farm this year, since the farm has received government subsidies. But the farm may charge some fees in the future," said Guo Shuan, a 42-year-old Xingtang dairy farmer.