TIA and Dairy Australia have joined forces to deliver a $6.5 million program that will run over five years to provide national dairy research and industry partnership program.

Dairy leader James Hills said the program would focus on feedbase research to help dairy farmers maintain efficient, profitable and sustainable pasture-based dairy systems in the future.

"We are setting an ambitious target to help dairy farmers grow the same amount of dry forage matter from irrigated pasture, produce the same amount of milk solids per hectare, but halve the amount of nitrogen fertiliser," Dr Hills said.

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To maximise the result of the research, mini-farms, or farmlets will be established in Tasmania for the first time, to test research theories under real farm conditions.

This research approach is not happening anywhere else in Australia and will involve managing four separate dairy herds under different pasture mixes at the TIA Dairy Research Facility at Elliott.

"The advantage of the farmlet approach is that it's focused on the whole farming system. This means we can do a really good comparison of different scenarios to identify the benefits and issues that dairy farms will face on their properties," Dr Hills said.

"The results will be highly relevant to farmers, who will be able to see the outcome of the way the herd is managed, and the impact different approaches have on their entire business."

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The five-year program, dubbed HIGH-2 (for high integrity grass-fed herds) has an ambitious target that has nationally relevant targets for all dairy farmers.

"We are setting an ambitious target to help dairy farmers grow the same amount of dry forage matter from irrigated pasture, produce the same amount of milk solids per hectare, but halve the amount of nitrogen fertiliser," Dr Hills said.

Tasmania's dairy industry is the largest contributor to Tasmania's farmgate value, and is worth $458 million per annum to the state, rising to $713 million once the milk is processed.

This year, Tasmanian dairy farmers broke a record and delivered 950 million litres of milk to their suppliers.

Primary Industries Minister Guy Barnett said he welcomed the TIA and Dairy Australia partnership agreement, saying the research was facilitated following the state government's $3 million investment in the research farm.

"The partnership between TIA and Dairy Australia recognises the importance of the dairy industry in Tasmania to our economy, and confirms we are on track to grow the value of Tasmania's entire agriculture sector to $10 billion a year by 2050 - driving investment and creating local jobs when our state needs them most in our recovery from COVID-19," he said.

TIA interim director Michael Rose said the partnership recognised TIA's expertise in dairy specific research.

"Our dairy research program continues to go from strength to strength. This new partnership combined with the recent investment in our TIA Dairy Research Facility from the state government and University of Tasmania will result in $11 million invested in TIA's dairy research over the next five years," Professor Rose said.

"We are proud to lead a nationally-relevant program from Tasmania that will help future proof the industry and ensure that dairy farms are sustainable and better equipped to face long-term challenges."