Beijing, China
February 27, 2008
Origin Agritech Limited
(NASDAQ GS: SEED) ("Origin"), a leading technology-focused
supplier of crop seeds and agri-biotech research in China, today
announced it has licensed a new genetically modified corn to
officially introduce the next generation of corn product into
China. Origin's phytase corn is expected to be one of the first
transgenic corn approved and sold commercially into the domestic
marketplace. Transgenic phytase corn is expected to be
commercially launched in 2009.
Phytase is currently used as an additive in animal feed to
breakdown phytic acid in corn, which holds 60% of the phosphorus
in corn. Phytase increases phosphorus absorption in animals by
60%. Phosphorus is an essential element for the growth and
development of all animals, and plays key roles in skeletal
structure and in vital metabolic pathways. Phytase, as an
additive for animal feed, is mandatory in Europe, Southeast
Asia, South Korea, Japan, Taiwan for environmental purposes.
The worldwide phytase potential market size is US$500 million,
including US$200 million for China alone, according to the China
Feed Industry Study. The corn seed market in China is estimated
at US$1 billion. While currently microbiology is universally
used to produce phytase, Origin plans to be the world's first to
introduce transgenic phytase corn.
Phytase transgenic corn, developed by and licensed from the
Chinese Academy of Agricultural Science (CAAS) after 7 years of
study, will allow animal feed producers the ability to eliminate
purchasing phytase and corn separately. It will eliminate the
need for mixing the two ingredients together, saving time,
machinery, and labor for the animal feed producers.
"Phytic acid, the main form of phosphorous in plant-origin
animal feeds, is poorly available to monogastric animals as they
lack the enzyme capable of hydrolyzing phytic acid to release
phosphate. Genetic modification is the world class standard and
that is where China is moving," Dr. Yun-Liu Fan, a distinguished
scientist of CAAS and member of the Chinese Academy of
Engineering commented. She continued, "our genetically modified
corn will reduce the need for such phosphate supplements and
reduce feed costs. We partnered with Origin because of their
strong execution ability, research and production capability,
and sales network to benefit the Chinese animal nutrition
market."
Origin's GMO phytase-producing corn is expected to reduce the
need for inorganic phosphate supplements as animals will
directly absorb more phosphate from their feed, reducing animal
feed's high cost. Inorganic phosphates may be contaminated with
fluorin and heavy metal residues created in the manufacturing
process. These fluorin and heavy metal residues in the feedstuff
are toxic to animals, and dangerous to humans.
In China, annual fecal phosphorus from animals totals 2.5
million tons which has led to serious environmental problem. The
usage of this product should also reduce the phosphorus
pollution caused by animal waste and excess fertilizer use.
Phytic acid in animal manure is a major source of phosphate
pollution. Phytase decreases the excretion of organic phosphorus
in feces by 40%, thus largely reducing phosphate pollution.
Phytase transgenic corn has passed the Ministry of Agriculture
evaluation for safety in the transgenic "intermediate-test" and
"environmental-release" stages and is currently in the final
stage of evaluation for "production test" safety.
The Chinese animal feed market is large and increasing to fill
the growing demand for meat products by the large populations in
China. On average, people in more developed countries consume an
average of 75 kilograms (kg) of meat annually with recent meat
consumption in China at only 23kg per person annually. However,
China is the world's leading pork producer with over 50% of the
world's production and consumption. Over 530 million hogs are
raised annually in China, as pork is the traditional meat of the
Chinese people and represents approximately 65% of all meats
consumed in the country. According to RTT news, official data
revealed that prices of food items soared in early January 2008,
and pork prices climbed 43% on an annual basis in January 2008.
China's rising middle class is demanding more meat consumption,
as it is estimated that for every 1% increase in take-home pay,
the average Chinese family will increase its meat consumption by
2%.
Dr.Gengchen Han, Origin's Chairman and Co-Chief Executive
Officer, said, "In the past few years, our focus on key
biotechnology has accelerated significantly. With our 40
in-house R&D professionals mainly engaged in the research of
genetic transformation, molecular biomarker testing and genetic
mapping activities, and our external alliances with top
agriculture biotech research institutions in China, Origin has
established several genetic engineering plant technology
platforms which include herbicide tolerance, insect resistance,
nitrogen efficiency, and drought stress tolerance in corn inbred
lines. We look forward to the commercial roll-out of Phytase
corn seeds. |
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