(Yicai Global) Jan. 19 -- Xiwang Group Co., a private Chinese company that owns three publicly traded firms, plans to establish its fourth and fifth listed businesses.
Xiwang Group is seeking to create two additional listed firms in the sugar sector over the next three to five years, bringing the number of traded firms it controls to five and building a Xiwang segment in the capital market, Chairman Wang Yong told Yicai Global. Its three listed firms are Xiwang Foodstuffs Co. [SHE:000639], Xiwang Special Steel Co. [HKG:1266] and Xiwang Property Holdings Co. [HKG:2088].
Given the current favorable conditions of persistently high sucrose prices, Xiwang plans to introduce white corn sugar to the market to develop it into a high value-added product to pave the way for the future consolidation and listing of relevant business segments, Wang noted.
He believes mass production and distribution of the product will greatly change the sugar industry's topography as it will not only diversify the product mix, but also impact sugar prices.
Xiwang Group is working on a white corn sugar project with an annual capacity of 500,000 tons and plans to expand its capacity to one million tons a year, market conditions permitting, Wang said. The group aims to generate CNY1 billion (USD147 million) in profit from its sugar segment by 2018.
Traditionally, the sugar-making industry uses sugar cane or sugar beets as raw materials. Guangxi and Yunnan provinces and Zhanjiang, Guangdong province in the south produce the bulk of China's cane sugar, while northern regions such as Xinjiang generate most of its beet sugar.
White corn sugar primarily consists of crystalline fructose mixed with glucose. It is produced by deep processing corn, and is 1.2 to 1.8 times as sweet as sucrose. Its production process is completely unaffected by crop production periods. Only a few corn sugar producers exist today in China, with Xiwang Group the country's largest.