1. Project Name: Sino-Foreign Cooperative Project of Deep Processing of Edible Fungus, Jiayin Farm

2. Location for Construction of the Project: Jiayin Farm, Heilongjiang Province

3. Profile of the Project Principal:

    綏化農墾招商網訊：Jiayin Farm is located in the south side of the middle section of the Heilongjiang River at the northeast foot of the Lesser Hinggan Mountains in Jiayin County. Its north side is opposite to Russia across the river and its south side is adjacent to Yichun forest region. The total area of the farm is 750,000 mu, including 440,000 mu of forest land, 240,000 mu of farmland, 20,000 mu of water surface and 50,000 mu of grassland. The total population is 9,976 in the farm, including 3,460 employees. Mechanized operation has been achieved in agriculture. The farm passed inspection and acceptance check by the expert group from the State Environmental Protection Administration in 2003 and the farm was approved to be as a state-level ecological demonstration farm. The climate condition here is very suitable for growth of edible fungus. Furthermore, rich experience has been accumulated in the fields from selection of species to large-scale cultivation. The farm can produce 20 million bags of edible fungus each year. Three black fungus bases have been built in the farm. One of the bases is the No. 1 large edible fungus processing factory, with annual capacity of 10 million bags, in Heilongjiang Land Reclamation Administration. It is worth mentioning that the “Jindou Bay” brand black fungus, enoki mushroom and hedgehog hydnum have passed pollution-free food demonstration. The pattern of “company + base + farmer families” has been formed on the farm. The farm’s “Beidahuang Fungi” has begun to provide bag-packed products with five unification standards, which mean “unified supply of strains, unified package, unified marketing, unified technical measures and unified base construction criteria”.

3. Project Construction

1,000 square meters of workshops and warehouses will be built to produce 1,000 tons of black fungus, honey mushroom, late fall oyster mushroom, enoki mushroom, hedgehog hydnum and other mountain products each year.

4. Source of Raw Materials and Market Situation

Source of raw materials: Jiayin Farm is located at the northeast foot of the Lesser Hinggan Mountains. The farm owns 440,000 mu of forest land, which is the second largest forest farm in Heilongjiang Land Reclamation Administration. The place is rich in mountain products. The products with high yield include: cultivated black fungus, hedgehog hydnum, enoki mushroom, wild bracken, mushrooms and so on. Edible fungus production has over 20 years of history and the local people know the technology for growing edible fungus. There is huge potential for development of such business. The output can reach 1,000 tons of black fungus, 400 tons of fresh bracken and more than 100 tons of fresh mushrooms. The supply of raw materials for the factory to be built with investment will be abundant.

Market Situation: Edible fungi are ideal foods that contain rich nutrition, taste good and have the functions to strengthen human health. With continuous improvement of people’s living standards and further development of commodity economy, edible fungus products not only sell well on major domestic market, but also sell well on international market. The market prospect is promising. The edible fungus products produced by Jiayin farm have supplied to a dozen provinces and metropolises such as Liaoning, Guangdong, Guangxi, Beijing, Shanghai, etc.

5. Estimate on Investment in the Project: The total investment in this project will be 10 million yuan to cover the cost of civil works, factory building, machines, processing equipments and application fee for various logos. The construction project for the project will be 1 year. The payback period will be 2 years. The rate of return will be 50%.

6. Economic Benefits of the Project: The annual sales revenue will be 20 million Yuan, with profit of 4 million Yuan.

8. Patterns of Cooperation: Joint venture or cooperation