November 3, 2010


Marubeni, Liuhe Group form animal feed venture in Shandong


Japanese trading house Marubeni Corp plans to form a livestock feed joint venture with Shandong Liuhe Group Co and build a plant in China's Shandong Province.


The plant would be built and operated as early as next year. Marubeni is expected to have a 30% stake in the joint venture and will likely invest around JPY10 billion (US$124 million). The Japanese company would also be responsible for procuring grains for use in the feed.


The two companies are currently finalising details of a plan to build a mixed-feed plant and silos for storing grains used in the feed in the coastal region of Shandong Province in 2011 or 2012.


As envisioned, the plant would be able to produce one million tonnes of feed per year, making it one of the largest facilities of its kind in Asia. Its annual output would account for around 4% of Japan's total mixed-feed production.


By partnering with Liuhe Group, Marubeni hopes to capitalise on China's growing meat demand, which jumped 18% on-year to around 61 million tonnes in 2009.