China Agri-Industries Holdings, a spin-off from COFCO International, plans to invest a total of 5.26 billion HK dollars to expand its biofuel and biochemical production capacity, the South China Morning Post reported, citing the company's managing director.

China Agri plans to boost the profit contribution from its biofuel and biochemical business to 50 percent over the next two years from 30 percent in 2006, the Hong Kong paper said.

The company will build four fuel ethanol plants in Guangxi, Hebei, Liaoning and Hubei provinces. They are expected to increase the company's annual fuel ethanol capacity to 1.08 million tons by next year from the present 180,000 tons.

China Agri starts selling retail shares as part of its Hong Kong initial public offering.

(1 US dollars = 7.8 HK dollars)