February 26, 2010

CP Cambodia to purchase US$30 million worth of grain

CP Group Cambodia Co Ltd announced Wednesday (Feb 24) it would buy US$30 million in grain as part of a plan to expand animal feed production by 20%.

Wittaya Kreangkriwit, vice president of CP Group Cambodia Co Ltd, said rising price of unprocessed grains was another reason for the company's increased expenditure, a significant rise on 2009 when the company spent US$19 million.

The company's expenses on animal feed raw materials this year will increase by 57.89% from last year, he said, adding that the company hopes to buy enough grain to fulfill its production demand.

The company plans to purchase 106,500 tonnes of grain, including 100,000 tonnes of red corn, 5,000 tonnes of cassava and 1,500 tonnes of soy between March and May this year, said Wittaya. The company will source the grains from Kampong Cham and Pailin provinces.

The company estimated all three of the main raw materials used to produce animal feed would increase in price, he added, with red corn likely to rise by 33%, cassava by 53% and soy by 26.7%.

Wittaya said CP plans to raise the price of its product by more than 8% this year from US$460 per tonne in 2009 to US$500 to offset the higher costs. The firm's revenue target is US$72 million for 2010.