BEIJING, May 9 (Reuters) - Cofco Tunhe Sugar Co Ltd , a subsidiary of agricultural conglomerate Cofco, signed a partnership agreement with Shandong Xingguang Sugar Group Co Ltd on trade and product development, according to a statement issued on Monday.
Under the deal, Cofco Tunhe will cooperate with Xingguang, a private refiner based in Shandong province, in sugar trading, utilizing Cofco’s background, and use Xingguang’s capacities in developing and producing sugar products, the statement said.
The partnership is a sign of further consolidation of the sugar sector in the world’s largest market for the sweetener, said Xu Sheng, an analyst with Huatai Futures.
“In the future, very likely there will be only several big sugar companies in China, with state-owned companies dominating,” Xu said.
The partnership also comes ahead of a government announcement on import tariffs on foreign sugar on May 22, following a months-long anti-dumping probe that started last September.
China earlier considered special duties on sugar imports over the next three years, starting this year.
Reporting by Hallie Gu and Josephine Mason; Editing by Christian Schmollinger