WINNIPEG - Canadian grain handler Viterra Inc confirmed plans on Tuesday to build a canola-crushing plant in South China with State-owned company Guangxi Beibu Gulf International Port Group Co.
The plant will be located at the port of Fangchenggang in the province of Guangxi and will crush 2,000 tons of canola a day, or about 680,000 tons annually, Viterra said. Construction will begin in May and be complete in 18 months.
Canada is the world's top canola exporter and China was its top export market in 2008-09. Canola is crushed for its oil, to be used in cooking and biofuel, and for its meal, which is a protein source in livestock feed.
Viterra, the top grain handler in Canada, moved aggressively into Southeast Asia last year when it bought Australia's ABB Grain, giving it the ability to acquire grain in both the Northern and Southern Hemispheres.
The new plant fits with Viterra's strategy of expanding processing into key markets such as China, where future demand for food is forecast to rise substantially, said Viterra President and Chief Executive Mayo Schmidt.
Viterra, which will own 49 percent of the plant, will invest $20 million to $25 million. Guangxi Beibu Gulf International Port Group will own 51 percent.
The joint venture will be called Fangchenggang Maple Grain & Oil Industrial Co Ltd.
Viterra shares on the Toronto Stock Exchange were up 2.6 percent at C$8.95 on Tuesday morning.
Reuters
