Scottish potato experts have joined forces with China's potato processor Xisen Potato Industry Group to create a 3 million-pound (.87 million) potato research facility in Shandong Province.
Xisen and the Chinese government will fund the lab which will be run in collaboration with potato scientists from the James Hutton Institute, an agricultural research center based in Dundee, Scotland.
The lab will look to breed new varieties of potato and conduct research into storage, processing, pests and disease.
Last year the Chinese government set out guidelines to promote potato consumption and production in China in order to bolster food security.
Scotland's potato crop is recognised within the European Union for its high health status.
Speaking at the Potatoes in Practice conference at the institute's Balruddery Farm this month, Xisen general manager Hu Baigeng said the potato is China's fourth most important staple behind rice, wheat and corn.
"We are a commercial, market-focused company and we have a long-term collaboration with James Hutton already," Hu said. "We're not just looking for bigger and bigger potatoes, we are looking for new varieties with high dry matter for processing but which also look nice."
China is the world's largest producer and consumer of potatoes, though per capita consumption is below that of the US and Europe.
China's vice minister of agriculture Yu Xinrong said last summer that the development of the potato industry is an important step in China's agricultural development.
James Hutton researcher Ian Toth said both Chinese and Scottish researchers will work together and results will be shared.
"We're still talking about how we will do it, but there's 3 million pounds of Chinese money to get the lab up and running and we have high hopes that it will cement the relationship between us and move it forward in the future," Toth told the Courier newspaper.
The announcement of the new lab follows a visit to Balruddery Farm by Xisen Potato Industry Group founder Liang Xisen last August.
Liang Xisen is China's self-proclaimed "King of Potatoes" and his company is one of the largest processors of potatoes in China.