Starbucks Coffee will launch a joint venture with a Chinese coffee-growing company later this year as the two sides signed a business cooperation memorandum of understanding (MOU) Thursday.

John Culver, president of Starbucks Coffee International, signed the deal with Liu Minghui, founder and chairman of Ai Ni Group, a coffee-growing and -processing firm in the southwestern province of Yunnan at a ceremony held at Little America Hotel on the sidelines of the inaugural China-U.S. Governors Forum, which runs from July 13 to 16.

"I was very excited today with the signing of the MOU with Ai Ni Group, which is one of Yunnan province's premier coffee-growing and -operating companies," Culver said in an exclusive interview with Xinhua. "By forming the joint venture, we will purchase and export coffee that is grown in Yunnan. We are very excited about the partnership."

Culver said Starbucks will teach local farmers how to grow high-quality coffee beans through sustainable practices, and ultimately help them increase their yield.

Starbucks will not only sell coffee grown in Yunnan in its 450 stores across China, but export it to 17,000 stores around the world.

The new business is slated to open later this year or early next year, Culver said.

Starbucks first entered China in 1999, and has over the years focused on opening more chain stores in primary and secondary cities around the country. It is the Seattle-based beverage seller's new strategy to get involved in the coffee-growing and -processing chain, so as to stabilize raw material supply and meet a growing demand for high-quality coffee from Chinese consumers.

China is the coffee chain's second-largest market after the United States. Chinese consumers have embraced Starbucks as a high-quality brand, and Starbucks has gone a long way to cater to its Chinese customers' needs through better service.

Starbucks plans to increase its China-based stores to 1,500 in the coming four years, Culver said.