July 5, 2011

Pork processor China Yurun Food Group Ltd said Monday (Jul 4) it has suspended production at its Weinan Shengqin plant in Shaanxi province following media allegations that it could be producing "problematic meat" there.

The company halted production at the plant, located in the city of Weinan, one day after local Chinese newspaper reported on June 30 that there could be problems with meat produced at the plant.

"In order to mitigate public doubts about articles on 'problematic meat' and Weinan Shengqin, the group, after its knowledge of the incident, has promptly demanded Weinan Shengqin plant to immediately suspend production for internal inspection of various processes," China Yurun said in a statement to the Hong Kong stock exchange.

The company said it has reported the case to the relevant local government authorities and cooperated with them in starting the investigation.

Yurun said Weinan Shengqin, which it acquired in 2010, has a daily slaughtering volume of less than 1% of the group's daily average slaughtering volume based on 2010 figures.

"As at the date of this announcement, the business of the Group remains normal," the statement said.