Beijing, China
March 10, 2008
- Conventional breeding program
continues to bring new products
- New seeds optimize local production
Origin Agritech Limited
(NASDAQ GS: SEED) (“Origin”), a leading technology-focused
supplier of crop seeds and agri-biotech research in China, today
announced the Ministry of Agriculture has approved two new corn
hybrid varieties to its product line for nationwide distribution
during the next sales season. The Company now has over 55 total
corn hybrids approved for sale into the marketplace next year.
Revenues from corn products consisted of roughly 75% of total
revenues in 2007, and are expected to continue to be the
company’s main product category in future years. This year marks
the company's 10th year of their own internal breeding program.
The two new corn seed products approved for nationwide
distribution include Lin Ao 9, and Ao Yu 28. These additional
products will aid our program to expand the Company’s geographic
reach throughout China. Lin Ao 9 and Ao Yu 28 are suitable for
the Southwest corn growing regions. However, given both products
have received nationwide approval, they are able to be sold into
any regions of China. In addition to expanding our product
coverage, seeds approved on a nationwide level generally allow
the Company increased marketing flexibility in deployment of the
products and the ability to cross products into additional
regions if the products are determined to be suitable for the
given regions. Generally, products selected for nationwide
deployment are more stable across a wider variety of
environmental conditions. One additional corn hybrid, Ao Yu 4,
has been approved for sale in the Ningxia province in China. The
corn seed market in China is estimated at US$1 billion.
The nationwide approval process runs in parallel with the
provincial approval processes, and is one of the most rigorous
regulatory requirements in all of China. Like the provincial
process, the nationwide approval requires the applicant to
undergo two growing seasons of monitored growth in more than 10
different locations around the country. Seeds submitted for
testing are planted together with local-area control seeds,
which are typically the seeds that have performed exceedingly
well in the testing regions. Only seeds that have an increased
yield of 5-8% or higher versus these control seeds are cleared
to proceed to the next year of testing. When all tests are
successfully completed, the approval is granted. The company
expects further approvals in rice and cotton seed in the
upcoming weeks.
Founded in 1997 and headquartered in Beijing, Origin Agritech
Limited (NASDAQ: SEED) is one of China’s leading,
vertically-integrated agricultural technology company
specializing in agri-biotech research, development and
production to supply the growing populations of China. Origin
develops, grows, processes, and markets crop seeds to farmers
throughout China and parts of Southeast Asia via a network of
approximately 3,800 first-level distributors and 6,500
second-level distributors. The hybrid seed industry is estimated
at US$2 billion and that is expected to double by 2010. The
Company currently operates facilities in 30 of China’s 32
provinces as well as Beijing. Since Origin launched its first
entirely internally developed seed in 2003, the Company has
developed and commercialized a proprietary seed portfolio of
twelve corn hybrids, twelve rice hybrids and two canola hybrids.
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