November 30, 2012


New Hope to move into Africa and Europe markets



China's agribusiness firm, New Hope Group, is moving into the markets of South Africa, Egypt, and Eastern and Central Europe.


New Hope Group Chairman Liu Yonghao said: "Going abroad helps us obtain cheaper land and grain and we bring our advantages of brand, technology and management, so it's a win-win strategy."


Liu said the company will set up factories or acquire companies dealing in the pork, poultry and dairy sectors in the three destinations.


He added that the pace of expansion in Southeast Asia this time would be faster than before. Since 1999, when it launched its first factory in Vietnam, New Hope has set up more than 20 animal feed plants and poultry farms in Southeast Asian countries, including the Philippines, Indonesia, Cambodia and Singapore.


Liu said the agricultural and animal husbandry industry faces many challenges this year. For instance, the price of pork has fallen a lot since September 2011, posing significant challenges for the group.


"It is normal that every industry has its ups and downs, and it is expected that by the latter half of next year, pork prices will be back to normal," Liu said.


He said although New Hope also invests in the chemical, finance and real estate sectors, its core business remains agriculture.


"Our target is to build our company into a world-class feed producer and agribusiness operator processing more than two billion chickens, two billion ducks and about 10 million pigs each year," Liu said.


He added that the Chinese agriculture market is huge but production units in China are small and decentralised. So it is important to seize the opportunity and improve technology, financial services and organisational systems in the sector. More mergers and acquisitions will take place.


The Ministry of Commerce said China's outbound direct investment is estimated to reach US$150 billion by 2015.