CHICAGO, March 13 (Reuters) - Archer Daniels Midland Co , one of the world’s largest agricultural traders, will widen its operations in China to produce fish feed, the company said on Monday, amid increasing global demand for fish from health-conscious consumers.
Expansion in high-growth regions like China is part of ADM’s strategy to improve returns and reduce the volatility of earnings due to swings in crop markets.
The Chicago-based company said it will build a new plant in Xiangtan, in central China, with capacity to produce 120,000 metric tons of animal and fish feeds annually. It will be ADM’s fifth animal feed plant in the country.
ADM also will add production lines for fish feed at a plant in Nanjing, in eastern China, to gain “entry into the growing Chinese high value specialty aquafeed market,” according to a statement.
A spokeswoman declined to say how much the projects will cost. The company expects both to be complete in 2019.
Other major agricultural traders also are expanding in the aquaculture business as they look to diversify away from bulk trading of grains and raw materials amid a four-year global supply glut.
Fish are the fastest-growing protein source in a global food supply chain straining to feed a population of nearly 7.5 billion people. The surging demand has pushed fish oil prices to a record high.
ADM said another animal-feed plant in Zhangzhou, in the southern part of the country, will likely be finished by this summer. Two years ago, the company was targeting the fourth quarter of 2016 for completion. (Reporting by Tom Polansek; Editing by Dan Grebler)