December 31, 2008
Zhongpin leases new pork facility in Jilin province
Zhongpin Inc. announced that on Tuesday (Dec 30), it entered into an agreement with Jilin Huazheng Agriculture and Animal Husbandry Development Co., Ltd. to lease a pork production facility in the city of Gongzhuling, Jilin Province.
Zhongpin plans to move part of its chilled and frozen pork production capacity to Jilin Province.
The newly-leased facility has an annual chilled and frozen pork production capacity of approximately 30,000 tonnes.
The leased facility has equipment that utilises advanced processing technology, and the additional production capacity is expected to generate sales revenue immediately.
Zhongpin has also decided to terminate in mid-January its lease for its existing pork facility in Heilongjiang Province, which has an annual capacity of 28,800 tonnes for chilled and frozen pork products.
As a result of the new lease and the termination of the existing lease, the total annual capacity of chilled and frozen pork products will be 418,760 tonnes after the transition is completed.
Following termination of the lease agreement, Zhongpin's subsidiary, Heilongjiang Zhongpin, will be transitioned into a trading entity, focusing on market development and cold chain logistics in Northern China.
Zhongpin Inc. CEO, Xianfu Zhu believes the decision to strategically relocate a portion of its chilled and frozen pork capacity will benefit the companyâ€™s future growth.
Jilin Province is one of China's major corn producing regions and has an abundant supply of hogs, which should help facilitate Zhongpin's penetration into some major cities in Northeastern China, such as Changchun, Jilin and Shenyang.