July 17, 2008

Ng Fung Hong and HNCOF join forces in US$51 million pig farm project

Hong Kong's leading foodstuffs supplier Ng Fung Hong Ltd has set up a pig farm joint venture with major pig farming corporation Henan Cereals, Oils and Foodstuffs Import and Export Group Corp (HNCOF), said China Resources Enterprise Ltd (CREL).

The venture, which has a registered capital of US$51 million, will have CREL subsidiary Ng Fung Hong shelling out US$36 million cash for a 70 percent stake. HNCOF will shoulder the remaining 30 percent by contributing its pig farming, feed processing and livestock trading businesses, said CREL in a statement.

CREL said the joint venture will produce 190,000 live pigs every year after it is set up.

Ng Fung Hong, the main live pig supplier to Hong Kong, hopes to further strengthen its livestock supply by banking on its partner's vast experience, said Mark Chen, CREL's managing director. 

State-owned company HNCOF is the largest intensive pig rearing enterprise in Henan, the second largest pig-rearing province in mainland China. Additionally, the company exports live pigs and cattle to Hong Kong.

Cooperation with HNCOF will thus ensure a reliable source for livestock supply to Hong Kong, said CREL.

Last year, pork traders and buyers in Hong Kong faced steep price hikes due to short supplies of fresh pigs.