New Zealand dairy giant Fonterra has signed an agreement with Argentina's biggest dairy cooperative, SanCor Co-Operativas Unidas Limitada, to market and distribute SanCor's dairy ingredients outside Argentina.

Fonterra said details of the exclusive sales agreement are confidential for commercial reasons, but the deal will see Fonterra sell on SanCor's behalf all its bulk commodity exports, predominantly milk powder and cheese, under SanCor brand names.

Fonterra's chief operating officer, Jay Waldvogel, said the agreement makes sense for both parties.

"Argentina's dairy industry is recovering well after a period of slow growth and we welcome the opportunity to partner with one of that country's leading dairy producers and exporters," Waldvogel added.