Sinograin looks at overseas deals to feed demand

Firm says step will strengthen control over supply of palm oil, soybeans

Sinograin Oils Corp, the oil-making arm of the State-owned conglomerate China Grain Reserves Corp, is targeting overseas investments in South America and Southeast Asia to strengthen its control over the supply of foodstuffs such as soybeans and palm oil.

Wang Qingrong, the company's vice-president, said eyeing overseas investments remains its "medium-term strategy and we are unlikely to take action within two years".

At the start of this year, Sinograin announced it planned to expand its commercial soy-crushing operation to profit from the country's rising demand for cooking oils and animal protein.

The expansion was seen as a move to help it compete for market share with Singapore-based Wilmar International, which now has the biggest crunching capacity and market share for consumer pack edible oils in the country through its China operation, Yihai Kerry.

Sinograin began to sell its own brand consumer pack soyoil to supermarkets late last year and aims to have sold 200,000 tons by the end of its financial year in February, said Wang.

He added that the company is targeting a 10 percent to 15 percent share of China's cooking oil market - which has a current annual consumption of 6 million tons - over the next five years.

"We are not targeting any specific company as a rival in the market," Wang said.

"As a State-owned company, all we try to do is help the government maintain a stable market price while securing income growth for farmers."

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