Chinese meat processor Zhongpin has blamed higher costs and increased competition for a fall in quarterly profits.

Zhongpin said its net income fell 40% to US$11m in the third quarter of the year. Sales increased 4% to $415.7m but Zhongpin said more of its revenue came from cheaper products, which, combined with higher hog and labour costs hit profits.

The company, which is listed in the US, also pointed to "higher competition in the market" and the need for more promotions to protect market share.