Thailand's Charoen Pokphand Group broke ground on what will become China's largest hen farm – with 45,000 tons of eggs of annual production – in Pinggu, a suburb northwest of Beijing, government officials announced March 22.

The project received backing from the Beijing BankPinggu district government and China Farmers’ Cooperatives, with total investment valued at US$85 million (582 million yuan), according to the announcement.

“Although Charoen Pokphand Group received a concession to operate the hen farm, its ownership has belonged to China Farmers’ Cooperatives,” said  Yu, a government spokesman who declined to give his first name.

“We have negotiated with Charoen Pokphand about specific management measures.”

Yu added that decisions about the egg distribution channels have not yet been made.

Charoen Pokphand Group's Beijing-based subsidiary did not respond to requests for comment.

The new farm is scheduled to be completed in 2010 and expected to house three million hens, with annual sales revenues of US$73 million (500 million yuan). It will provide 45,000 tons of eggs each year.

The size of the egg market in Beijing and neighboring Tianjin was 430,000 tons in 2006, the government reported, with high-end brands accounting for 22,500 tons, or 5% of the total market.

The Bangkok-based Charoen Pokphand Group has operations in the agribusiness, retail and telecommunications markets.