November 11, 2009

CP Group expands on pig breeding in China

Thailand-based feedstuff maker Charoen Pokphand Group (CP Group), or Chia Tai Group as it is called in China, is looking for a way to extend its lead in the feedstuff sector by cutting into the pig breeding industry.

Since early this year, the group has spent some RMB4 billion setting up pig farms in such Chinese provinces as Anhui, Hebei, and Shandong and feeding about 2 million pigs.

On November 6, the group signed a deal with the local government in Chuzhou to set up pig farms, slaughterhouses, and foods processing factories there with a total investment of RMB2 billion.

The aggressive expansion of the group in China is meant to trade on the long-term strategy of the Chinese government to promote its rural economy and invigorate the domestic consumption.

The group's feedstuff output has been maintained at the range of 6 million tonnes to 7 million tonnes in the past few years. Its pig breeding unit is expected to give its feedstuff business a big lift.

US$1 = RMB6.82 (Nov 11)