January 21, 2008

CP to expand corn production in Asian countries

The CP Group plans to increase its corn plantations in four neighbouring countries by another 267,200 hectares to provide feed for the group's livestock business.

Ajva Taulananda, vice-chairman of the group, said the expansion was planned over the next two years to bring the total acreage to 512,000 ha in Vietnam, Burma, Cambodia and Laos.

The expansion is expected to generate an additional 1.67 million tonnes of corn for CP to supply animal feedmill production and livestock farming for CP Group and its SET-listed flagship Charoen Pokphand Foods Plc.

Corn sales in these countries are covered under a tariff-free arrangement backed by the Ayerawaddy-Chao Phraya-Mekong Economic Co-operation Strategy (Acmecs), a programme launched in 2003 to promote the regional economy by raising farm incomes in Cambodia, Laos, Burma, Vietnam, and Thailand.

CP was among the first Thai corporations to grow corn in the region, planting about 160,000 ha of the crop.

Under the contract-farming format, CP provides hybrid seeds and farm technology to farmers and buys the produce back at market prices, the company said.

The group's advanced seed development had reportedly boosted yields to about 1,000 kilogrammes per 0.16 ha, well above the average of 650 kilogramme produced in Thailand at present.

Corn exports from the US would continue decreasing as the crop would be used more in ethanol plants, CP officials said.