July 13, 2007

China's BBCA Biochemical suspends lysine production  

China's BBCA Biochemical announced on July 12 that it will temporarily halt lysine and monosodium glutamate production after two of its plants located in the Huai River Basin had been affected by heavy flooding.

In its announcement, the company also cited stiff competition in the domestic lysine and monosodium glutamate market segments, as well as high corn prices as other important factors of consideration before it decides to suspend production temporarily.

The Anhui province-based company will now focus on repair works of its production facilities and it expects to resume production at a later date. At the same time, BBCA Biochemical will also be proceeding with making insurance claims for damages to its facilities.

This round of production halt is not expected to have a significant impact on the company's financial performance for 2007. In 2006, sales of its amino acid products contributed RMB446 million, or about 10.2 percent to its total revenue.

RMB1=US$0.1321 (Jul 13)