General trading house Itochu Corp. has formed a capital partnership with Chinese coffee product maker Shanghai Weiming Food Co. to cater to the country's fast-growing coffee market.

Relevant procedures on the deal have been completed, an Itochu spokesman said without giving details, only revealing that it is investing hundreds of millions of yen and that the amount makes it the second-largest shareholder of the Shanghai-based company.

The capital alliance, Itochu's first with a Chinese coffee company, scaled up the previous business tie-up deal under which the Japanese trader supplied coffer beans to Shanghai Weiming.

Itochu can now not only strengthen the supply functions for coffee beans by making the most of its global network but engage in sales of Shanghai Weiming's products in the Chinese market.

The Itochu spokesman said the rapidly expanding demand for coffee in China, particularly from among consumers in metropolitan areas and young people, is creating fresh business opportunities in a country where tea has traditionally been much more popular.

Itochu is also paying attention to the increasing awareness of food safety among Chinese consumers. In a possible future collaboration with the Chinese partner, Itochu plans to employ the platform it is using in a tie-up with Farmer Connect SA of Switzerland to check where the beans are grown and other detailed information on the beans. (NNA/Kyodo)

==Kyodo

© Kyodo News International, Inc., source Newswire