Bright Dairy & Food Co Ltd, under pressure of high costs brought on by a lack of raw milk, signed a supply agreement with Australia's Pactum Dairy Group for room temperature milk for China's booming market.

The move reflects rising demand to import room temperature milk rather than sourcing from domestic farms, industry analysts said.

Undersupply pushed up raw milk and product prices last year. That eased in 2014 largely, Song Liang, an industry analyst, said.