中国利农集团有限公司

We are one of the largest greenhouse vegetable producers in China, with our greenhouses covering approximately 34.4% of our total arable land as of March 31, 2012. We grow vegetables by using greenhouses primarily and specialize in producing and selling off-season vegetables. We focus on applying advanced agricultural know-how to grow safe and consistently high-quality vegetables. We sell over 50 varieties of vegetables to wholesalers, institutional customers and supermarket chains in China and Hong Kong. Our customers include leading international hypermarket chain Walmart and the top three Hong Kong supermarket chains, Wellcome, ParknShop and Vanguard, each with stringent vendor qualification requirements. We have established and relied on a comprehensive database in planning each stage of the crop cultivation process, from seed selection to crop production to harvesting, taking into account customer preferences, and market and meteorological conditions. Combining the use of our proprietary planning system, our advanced horticultural know-how and greenhouse cultivation, we have been able to better control crop cycles and harvest schedules to capture attractive market opportunities, such as off-season and higher-priced vegetables. We operated 11 farms with an aggregate area of 25,063 mu (1,671 hectares) in the Chinese provinces of Fujian, Guangdong and Hebei as of March 31, 2012. Ten of our farms, with an aggregate area of 21,081 mu (1,405 hectares), are located in Fujian and Guangdong near our target markets in southern China. These areas offer a favorable climate for year-around crop cultivation, which provides a stable and reliable supply of vegetables desired by many of our customers. We also operate one farm in Hebei province to produce vegetables that grow best in a cooler climate. We use greenhouses to grow vegetables in most of our Fujian and Guangdong farms. Our greenhouses are sturdy structures equipped with retractable walls to regulate temperature without the use of energy supply and temperature control systems. Greenhouses protect our crops from adverse weather conditions, such as typhoons and rainstorms, that are common in the summer in southern China. They also create a favorable microclimate that, together with our horticultural know-how, allows us to grow and sell vegetables of superior quality and uniform size, color and ripeness that are desired by consumers, as well as off-season vegetables during the winter, when supplies of these vegetables are limited and their prices are high, which enables us to avoid selling into a highly commoditized market. Compared to open-field farming, greenhouse cultivation improves our production yield, profit margins and return on our investment expenditures. Accordingly, our greenhouses have contributed to a significantly higher percentage of our revenues than would be suggested by their percentage coverage of our arable land. Through years of research, development and production experience, we have accumulated proprietary horticultural know-how for each step of the crop cultivation process. We have formulated this know-how into standardized production processes for each type of vegetable we produce. Each process is broken down into simple steps to allow for uniform application of our horticultural know-how across all production bases, while minimizing the time for training farm workers. Each year we test grow many varieties of seeds supplied by domestic and international seed companies to identify new varieties with superior quality and production yield. We devote significant resources to research and development. We also collaborate with domestic research institutions, universities and industry experts to develop cultivation techniques and improve production yield. We have systematically gathered, collected and analyzed market information, seed information, meteorological information, as well as vegetable supply information in China. We have gathered a large volume of data on historical vegetable price movements and weather patterns in various regions of China, which helps us to plan crop cultivation and harvest. We are collaborating with the National Engineering Research Center for Information Technology in Agriculture to develop an advanced information management system and database to better organize and utilize our know-how.