Yu Zihua, assistant to the general manager of COFCO's biochemical and bioenergy division, said COFCO had planned to build a 150,000-tonne-per- year ethanol plant in Hengshui, Hebei. It would have used sweet potatoes and sweet sorghum as feedstock.

Yu said he was not aware of the fate of a plan for another sweet potato-based plant by its unit China Agri-Industries Holdings (0606) in Jiangsu. He was talking to reporters on the sidelines of a grains conference.

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China Agri said it intended to build a 100,000-tonne per year fuel ethanol plant in Jiangsu that would use sweet potato. Last month, industry officials said China was likely to face shortages in raw materials, including sweet potatoes, to feed an increasing number of fuel ethanol plants.

PetroChina (0857) was also conducting a feasibility study for a sweet potato-based ethanol plant in Sichuan province.

Yu said using such feedstocks would have transport and storage problems. Alarmed by high corn prices, which also helped raise domestic pork prices, Beijing has already introduced a series of measures to curb the corn processing industries, including corn- based fuel ethanol plants.

This has encouraged ethanol producers to shift towards other raw materials, such as cassava or sweet potatoes.

Yu said COFCO's cassava-based ethanol plant in the southern region of Guangxi would start operation in December.

It would produce 150,000 tonnes of fuel ethanol per year.

It was not immediately clear if COFCO had downgraded the fuel ethanol plant in Guangxi.

It said last year that the plant in Guangxi would have an annual capacity of 200,000 tonnes. REUTERS