Total Annual Capacity Increases to 55,000 Metric Tons of Fertilizer
XI'AN, China, Sept. 1 /PRNewswire-Asia/ -- China Green Agriculture, Inc. (NYSE Amex: CGA; "China Green Agriculture" or "the Company"), a leading producer and distributor of humic acid ("HA") based green fertilizer through its wholly owned subsidiary, Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd., today announced the grand opening of its newest production facility in X'ian, China. The announcement of the new facility was made in May 2008 and the facility began formal production in August 2009.
China Green Agriculture held its grand opening ceremony for the 40,000 ton production line adjacent to its existing 15,000 ton facility on August 28, 2009. The new facility increases the Company's production capacity from 15,000 tons per year to 55,000 tons per year to meet the growing demand for its green fertilizer products. China Green Agriculture was the first company in China to build a fully automated manufacturing system which precisely measures and mixes key ingredients to formulate its unique fertilizer products. While the Company's current facility incorporates a high degree of automation, new automated equipment has been added in the new factory, which increases efficiency and further reduces reliance on manual labor. These advanced production techniques reduce waste which in turn reduces costs.
In addition, China Green Agriculture is the first company to install a fully integrated quality control system with mobile wireless monitoring which enables the Company to closely supervise its production process in the new facility. China Green Agriculture currently only manufactures liquid fertilizer products; however the new facility is capable of producing both liquid and highly concentrated fertilizer (i.e. powder fertilizer) and is also the first fertilizer manufacturer in China to apply microwave technology to its production of highly concentrated fertilizer.
China Green Agriculture's new facilities include 27 vats for mixing ingredients and pharmaceutical grade, electronically calibrated measuring equipment spread over approximately 148,000 square feet. The Company expects to reach full utilization of its 55,000 metric ton capacity over the next three years. Sales volume is expected to increase 40-45% with a utilization rate of 35%-38% by the end of the fiscal year 2010. Formal guidance for fiscal year 2010 will be provided by management with the fourth quarter and fiscal year 2009 earnings announcement scheduled for mid-September.
"Based on the growing market demand for our green fertilizer products coupled with our extensive distribution network, we expect that our increased capacity will be rapidly absorbed by the Chinese fertilizer market. This facility will be our growth driver for the fiscal year ending June 30, 2010, allowing us to meet our revenue and net income targets," commented Mr. Tao Li, Chairman and CEO of China Green Agriculture. "We continue to see strong demand within the 27 provinces that we cover, as the Chinese government seeks to increase farmers' income and boost the growth of diversified crops, especially for organic food. By leveraging our new facility we are well positioned to gain further market share in China's fertilizer market."
About China Green Agriculture, Inc.
China Green Agriculture, Inc. produces and distributes humic acid ("HA") based green fertilizer through its wholly owned subsidiary, Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd., ("TechTeam"). TechTeam produces and sells over 100 different kinds of fertilizer products per year. All of TechTeam's fertilizer products are certified by the PRC government as green food production materials, as stated by the China Green Food Research Center. TechTeam's fertilizers are highly concentrated liquids which require an application of approximately 120 ml per mu per application. Its average end user has approximately four mu of land (one mu = .165 acres).
China Green Agriculture currently markets its fertilizer products to private wholesalers and retailers of agricultural farm products in 27 provinces in the PRC. The leading five provinces by revenue for the three months ended March 31, 2009 are Shaanxi (12.2%), Shandong (10.6%), Anhui (6.2%), Xinjiang (6.0%) and Henan (5.4%), which in total accounted for 40.5% of our total fertilizer sales from the sale of our fertilizer products. For more information, visit http://www.cgagri.com .
Safe Harbor Statement
This press release contains forward-looking statements concerning the Company's business, products and financial results. The Company's actual results may differ materially from those anticipated in the forward-looking statements depending on a number of risk factors including, but not limited to, the following: general economic and business conditions, development, shipment, market acceptance, additional competition from existing and new competitors, changes in technology, and various other factors beyond the Company's control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risk factors detailed in the Company's reports filed with the Securities and Exchange Commission. China Green Agriculture undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.
For further information, please contact:
China Green Agriculture, Inc.
Ms. Ying Yang, Chief Financial Officer
Tel: +1-626-623-2575
Email: yangying@techteam.com.cn
HC International, Inc.
Ted Haberfield, Executive VP
Tel: +1-760-755-2716
Email: thaberfield@hcinternational.net
Web: http://www.hcinternational.net
