May 10, 2007

Yurun Group to build broiler plant in Anhui, China

Yurun Group, China's biggest low-temperature meat producer, announced it is building a RMB 300 million (US$39 million) broiler processing plant in Anhui Province, Zhong An City's Chang Feng County.

Spanning an area of 8 hectares, Yurun's facility would have a yearly processing capacity of 30 million broilers. Construction is expected to begin in September this year, with expected tax revenues for the county at more than RMB 7 million (US$910,000).  

In mid-April, the company announced that it plans to acquire more of its smaller rivals to gain a larger share of China's chilled pork and meat product market in an effort to instill consolidation in the industry.

Yurun, Henan Shuanghui Investment & Development Co. and People's Food Holdings Ltd. are the top three meat producers in China in terms of sales.

Strong demand for processed meat and pork in China is expected to drive double-digit growth in sales this year.

Yurun expects 2007's performance to be better than 2006 and sales this year should reach double-digit growth while maintaining a stable gross profit margin.

Yurun's 2006 net profit rose 36 percent to RMB 428 million, while sales increased 6 percent to RMB 4.72 billion.

The company is also optimistic it can double its hog slaughtering capacity to 20 million heads by 2008-2009.