This guidance is based on several assumptions and strategies including: continuation of China's policies designed to stimulate domestic consumption and economic growth; higher average pork prices in China's pork industry in 2010 than in 2009; higher sales volume of its pork products, led by chilled pork products, followed by prepared pork products and frozen pork products; a higher percentage of sales from our higher-margin chilled pork and prepared pork products; average capacity utilization of about 75 percent for pork products; increasing distribution efficiencies from expansion of our cold-chain logistics system and service areas; growing awareness of the Zhongpin brand in regional markets and emerging brand awareness across China; and continuation of the Chinese government's support and subsidies for producers of agricultural products, such as Zhongpin.
Zhongpin expects China's food processing industry will continue to consolidate, which may result in higher market shares for its main competitors.
Zhongpin Inc. is a meat and food processing company that specializes in pork and pork products, vegetables and fruits in China. Its distribution network in China covers 20 provinces plus Beijing, Shanghai, Tianjin, and Chongqing and includes more than 3,000 retail outlets. Zhongpin's export markets include the European Union and Southeast Asia.