OREANDA-NEWS. Sumitomo Corporation, Taikoo Sugar Limited  and TS Corporation have agreed to establish a joint venture company for production and sales of sugar (hereinafter "JV company") in Guangdong Province, China. Taikoo, TS and Sumitomo Corporation will own 34%, 33% and 33% interests, respectively, in the JV company.

In 2012, total annual consumption of sugar in mainland China reached 14 million tons. As the beverage market expands in tandem with the rapid economic growth and westernization of dietary patterns in China, sugar consumption is expected to grow 5% annually. Moreover, due to rising concerns over food safety, demand for high-quality sugar is increasing mainly from major food processing manufacturers and volume retailers. Taikoo, TS and Sumitomo Corporation have already worked together in sugar trading in and around China and have built up a strong relationship of trust. Based on this trust, the three companies have decided to jointly expand their sugar business into Chinese high-quality refined sugar market, which is expected to achieve significant growth in the years to come. 

The JV company will combine Taikoo's brand power and marketing capabilities, TS's advanced manufacturing technologies, and Sumitomo Corporation's experience in sugar trading in Southeast Asia and expertise on overseas business management, with the aim of establishing a system for production and sales of high-quality sugar in mainland China. The three companies have a plan to establish the JV company and construct a sugar refining plant in Guangdong Province, China, aiming to start operation by the end of 2014. Through this business, Sumitomo Corporation will work to contribute to the sophistication of dietary patterns in mainland China.