Pingtan, which is engaged in ocean fishing, said it had entered into a strategic agreement with China Co-op (Hainan) Industry Development Co. that will see the two companies work together to boost Pingtan’s goal to develop into a seller of fish products directly to end-markets.
As part of this agreement, the two companies will jointly construct a fish processing plant and Pingtan's fishing products will then be sold to China Co-op's numerous supermarket locations across China.
Pingtan’s board recently approved a resolution under which it will begin negotiating with the government of Fujian province to acquire operating rights for a parcel of land on which it intends to construct the fish processing plant.
China Co-op is part of China's largest federal-level food industry enterprise group. The company operates more than 300,000 stores within its supermarket chain across China.
“We feel that this cooperation is a positive reflection on Pingtan's credibility and leading position within the fishing industry,” said Xinrong Zhuo, Pingtan’s chairman and chief executive.
“We believe this partnership will accelerate our progress to becoming a vertically integrated seafood provider and also enhances our market competitiveness as our products would reach to both inland and remote areas through their massive sales network,” said Zhuo.
Pingtan is engaged in ocean fishing through its wholly-owned subsidiary Pingtan Fishing, which operates self-owned vessels operating within the Indian Exclusive Economic Zone and the Arafura Sea of Indonesia.
Data from the Chinese government revealed last year that China’s consumption of seafood products, at 16.5 million mt accounted for 30% of the country’s total aquatic output, and was growing at a rate of 5.71%—significantly faster than overall output of aquatic products.
Growing at an average 3.83% a year between 2000 and 2011, growth in China’s seafood output has slowed from the highs seen in 1980-90 (10% a year) and 1990-2000 (6%), forcing companies like Pingtan to wade into waters outside China’s own exclusive economic zones.