Tsingtao Brewery, China's largest brewer, said it expects to increase profits by more than 40% this year as a result of demand increases for its products in the country. The company said, “beer demand this year will increase by about 5% helped by higher incomes of farmers and poorer urbanites.”

The profits rise would mean that Tsingtao could earn as much as 8.5 billion yuan (US$1 billion) in revenues this year, compared with an estimated 6 billion yuan last year. Tsingtao posted 4.7 billion yuan in revenues in 2001.

"The increase mainly comes from organic growth of existing facilities," company president Jin Zhiguo said. The brewer, which has a partnership with US giant Anheuser-Busch, plans to acquire two or three smaller, domestic breweries this year, each with an annual output of about 500,000 tonnes, he said, but declined to name them.

The company has bought more than 40 breweries since 1997.

11 March, 2003