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March 6, 2017

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New Hope and Cargill in soybean crushing JV

Source: Agencies | March 6, 2017, Monday | Print Edition

CHINESE agribusiness group New Hope plans to build its first soybean crushing plant in Hebei Province in a joint venture with Cargill, its Chairman Liu Yonghao said on Saturday.

New Hope and provincial state-owned companies will own 51 percent of the project, which will have a daily capacity of 50,000 tons, while US commodity merchant Cargill will hold 49 percent, he said.

The soy crushing industry in China, the world’s top soybean buyer, has expanded rapidly in recent years due to rising demand from breeders of livestock from hogs to poultry, although there is significant overcapacity in the sector.

The US government reckons crushing volume of around 76 million tons last year was far below the country’s capacity.

Liu has built New Hope from a small chicken farm into the country’s top animal feed producer, with businesses extending to banking and property and annual sales of 90 billion yuan (US$13 billion).

His plans come as New Hope also aims to expand abroad.

In about 10 years, international farm products will take up 40 percent of total revenue, up from 10 percent now, the company is setting up a European headquarters in the Netherlands and will open a US office, he said. The firm already has offices in Australia and Singapore.

For its international strategy, Liu said New Hope will build plants in under-developed countries while focusing on acquisitions and tie-ups in developed countries.

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