Marine Harvest Scotland, who recently announced jobs cuts at a number of locations throughout the country, has chosen a site known as Altanavaig quarry.
Managing director Ben Hadfield said: “We are delighted to have found a site which sits at the heart of our operations – one that is already an industrial site but which has not been fully utilised for some time.
“We would like to have the chance to bring it back to life and provide well paid jobs, as well as taking the opportunity to produce our feed in the most sustainable way.
“This is a large investment in Scotland and the development of a feed plant here is part of our overall drive to become a more efficient and sustainable business.
“We hope this will be a major boost for the local economy and we are keen to start discussions with the local community and hear their views about our proposals.”
Marine Harvest Scotland said in January they were looking for a site to accommodate their new plant which will produce feed for use on their Scottish farms, as well as for Ireland, Norway and the Faroes.
They hope to replicate the success of a similar plant in Norway which has provided a welcome boost to the local economy by providing jobs directly, as well as generating employment for local contractors and suppliers.
The company will now start consultation with the local community as part of the planning application process.
They plan to hold public meetings in Kyleakin and Kyle in April.
Construction of the plant will take between a year and eighteen months and Marine Harvest believe it could be up and running as early as 2018, depending on the planning process.
Around four acres of the site will be used to accommodate the buildings which will include the processing plant itself as well as raw material storage silos, product storage and packaging, a loading area and car parking. The existing pier will need to be extended.
Mr Hadfield added: “We considered a number of different locations before deciding on Kyleakin Quarry.
“The site more than meets our criteria which included a central location for our farms, access to an existing jetty or pier, or the potential to build one, good road transport links and the availability of power and water supplies at a reasonable cost.
“This is a great opportunity for Kyleakin and the local economy and we hope to have the chance to discuss our plans with the local community as soon as possible.”
Marine Harvest Scotland is the largest salmon farming company in Scotland, producing more than 50,000 tonnes in 2015.
It was the first company in Scotland to farm Atlantic salmon and celebrated its 50th anniversary last year.
The company has four hatcheries, five freshwater loch sites and 47 sea farms, situated in the Western Isles, Skye, Argyll, Wester Ross and Lochaber.
Live fish are harvested at Mallaig and processed at the Blar Mhor processing plant in Fort William.
In 2014, a new Marine Harvest salmon processing plant at Rosyth opened, producing a range of value added salmon products for the consumer market.
The company holds the Royal Warrant for the supply of fresh farmed salmon to Her Majesty the Queen.
It has also held the prestigious Label Rouge quality accreditation in France since 1992.
The main markets for Marine Harvest fresh salmon are the UK, France, USA, Poland and China.