Macau Eiji Co., Ltd. (MEIJI) was acquired by Sino Agro Food, Inc. on September 5, 2007, and is a wholly owned entity of the Company. MEIJI has two sources of revenue: (i) engineering consulting (mainly in cattle farming and vegetable farming), technology consulting, management services, and (ii) marketing and sales of cattle and related products. MEIJI serves as an investment holding company for Sino Agro Food, Inc.
Engineering and Services are generated from the construction and development of Cattle Farm 1 (JHMC) and Cattle Farm 2 (EAPBCF). Other revenues are generated from the marketing and sales of live cattle. MEIJI purchases fully grown cattle from Cattle Farm 1 and sells them to the cattle wholesalers, as well as buys young cattle from other farmers and sells the young stock to Cattle Farm 1.
All cattle farms developed by MEIJI use its “Semi-free growing” management system and aromatic-feed programs and systems to raise beef cattle. The photo at the top of this page shows an aerial view of Cattle Farm 1.
Beef is traditionally a niche market in China, as it is mainly sold to expensive restaurants or upscale hotels rather than to Chinese consumers. This situation is rapidly changing, though. Owing to urbanization and rising incomes, there is rising demand for a high protein diet, and a rise in restaurant dining due to work demands.
Our free range cattle grown in the Enping farms are fed with natural pastures, concentrated livestock feed and our Aromatic Feed that contains Chinese herbal plants specially designed to improve animal health such that these Enping farms produce healthy cattle and in turn quality meat. Although we cannot have them certified as pure organic meat yet because we cannot get certification from suppliers of the raw materials used to make our concentrated feed purely organic, we believe that we are not far away from being qualified to obtain 100% pure organic meat certification.
The Enping cattle farms are situated in Guangdong Province, which is not a traditional cattle growing country due to its tropical climate. Most cattle and beef supplies are imported from the Western and Northern Provinces at higher costs entailing higher wholesale and retail prices in Guangzhou City and in its urban cities, which provides marketing advantages for our cattle sales within the region.
Moreover, our sampled meat trials carried out with a number of reputable restaurants and hotels in Beijing City were well received with constant requests for us to supply them on a long-term basis. Our strategy is to ensure we can supply the quantity to maintain consistently sustainable supplies as required by our customers. At Enping cattle farms we will grow at least 1,000 heads of mature cattle, which is the minimum number required to sustain the supplies to just a couple of restaurant chains.
Cattle Farm 1 is doing well and on target. The change of stocking of older cattle (from 15 to 16 months old) and fattening them at the farm for period of 5 to 6 months resulted in CF1 selling increasing numbers of head of cattle (at an average of 18 months old) enhancing much faster turn-around of sales of cattle at the farm.