TOKYO, April 30 (Kyodo) — Trading house Sumitomo Corp. said Tuesday it will set up a joint venture in China with Hong Kong and South Korean firms to manufacture and sell sugar from 2014.
Sumitomo and TS Corp. of South Korea will hold a 33 percent stake each in the joint venture, while Taikoo Sugar Ltd. of Hong Kong will have a 34 percent stake in the venture to be launched in China's Guangdong Province.
The venture aims to make use of the power of Taikoo's brand and marketing expertise, TS's sugar manufacturing techniques and Sumitomo's experience with overseas business management.
"Through this business, we will contribute to the improvement of China's diet," Sumitomo Corp. said in a press release.
In 2012, sugar consumption in mainland China reached 14 million tons and is expected to increase 5 percent annually due to the Westernization of the Chinese palate and expanding beverage markets amid the country's rapid economic growth.
To address food safety concerns in China, demand for high-quality sugar from major food processing companies and mass retailers has been on the rise, according to Sumitomo Corp.