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BEIJING/PARIS, Sept 26 (Reuters) - International commodity merchant Louis Dreyfus Company (LDC) and China's Luckin Coffee are to develop a juice business, in a step by LDC to expand into retail food products in China.
The joint venture will involve producing and distributing co-branded juices and includes plans to build a bottling plant, LDC and Luckin Coffee said in a joint statement on Thursday.
Financial terms were not disclosed.
The venture, building on LDC's juice division that has mainly focussed on bulk supplies rather than retail products, reinforces ties between the two companies.
LDC acquired a stake in Luckin during the Chinese firm's share listing earlier this year and the groups are also planning to build a coffee roasting plant in China.
LDC, one of the world's biggest crop merchants, has said it wants to increase its presence in food processing and has cited regional partnerships as a way to expand.
It had in recent years earmarked its juice division, which has been affected by consumer health concerns about sugar content, for a possible sale or spin-off as a joint venture.
But the commodity group said this year the juice division was a core business and it was looking for partners to support investments in expanding further down the supply chain.
The venture with Luckin in China will focus on co-branded not from concentrate (NFC) orange, lemon and apple juices, and will market products via Luckin Coffee shops and other channels, the companies said.
"China is the fastest-growing NFC market globally and, together, Luckin and LDC see a significant opportunity to offer high quality, sustainably-developed NFC juices to the Chinese consumer," Jinyi Guo, Luckin Coffee senior vice president and co-founder, said in the statement.
The partners expect to launch their juice next year, an LDC spokeswoman added.
Luckin has been expanding aggressively in China as it competes with U.S. coffee giant Starbucks.
LDC is one of the world's largest bulk suppliers of citrus fruit juices and its operations include fruit farms, processing facilities and port terminals.
It is also targeting the consumer end of the food chain in China with plans to market bottled edible oil from a factory it acquired last year.
At group level, LDC has said it is considering selling minority stakes to regional partners, as the 168-year-old firm controlled by Margarita Louis-Dreyfus seeks to emerge from restructuring and the exit of minority family shareholders. (Reporting by Gus Trompiz and Beijing Monitoring Desk; Editing by Edmund Blair)