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 1. Project Name: Extension Project of Heilongjiang Land Reclamation Nenyuan Rice Co., Ltd.

2. Location for Construction of the Project: In the farm area of Zhaoyuan Farm, Heilongjiang Province

3. Profile of the Project Principal:

    綏化農墾招商網訊：Nenyuan Rice Co. is located on the left side of the lower reaches of the Nenjiang River in Zhaoyuan Farm. It is 9 km away from Xinzhao Railway Station, 30 km from Lin-Zhao Highway, 150 km from Daqing and 230 km from Harbin. Its west side is just opposite to Da’an City, Jilin Province across the Nenjiang River. The place is easily accessible by means of highways, railways or waterways. Nenyuan Rice Industry was founded in 2008, with equity participation by Zhaoyuan Farm. Its registered capital is 10 million Yuan. The net value of its fixed assets is 5.81 million Yuan. The company is built on a land area of 30,000 square meters. The company has a drying tower with daily processing capacity of 200 tons of rice, a metal barn with storage capacity of 17,000 tons, a warehouse for rice as finished product with storage capacity of 500 tons and a Switzerland-made Buhler brand refined rice production line with daily processing capacity of 150 tons of rice. The company is equipped with color sorters, fine selection machines and polishing machines. Its processing equipments are among the best in the world. Its fine rice processing capacity is 100 tons per day. Its annual processing capacity is 30,000 tons.

4. Project Construction

Nenyuan Rice Industry has a fine rice production line with the processing capacity of 30,000 tons per year currently, and plans to increase the production capacity to 70,000 tons in 2012, the specific construction projects are: build factory building and warehouse with 2,500 square meters, two metal barns with 7,000 tons; purchase and install two Switzerland-made Buhler refined rice production line with daily processing capacity of 50 tons of rice and 100 tons of rice respectively.

5. Product Composition, Source of Raw Materials and Market Situation

Product Composition: The main business of Heilongjiang Land Reclamation Nenyuan Rice Co., Ltd. is production of “Nenyuan” brand top-class rice. Its products are divided into two categories: high-grade gift rice and ordinary rice. There are more than twenty different packaging designs for the products. The most expensive top-class rice has reached up to 60 Yuan per jin. Now the product has been included in the product quality traceability system of the Ministry of Agriculture. “Nenyuan” trademark is a well-known trademark of Heilongjiang Province. “Nenyuan” brand long-grain fragrant rice has become an official product by the State Olympic Sports Center.

Source of Raw Materials: Zhaoyuan farm produces about 40,000 tons of organic paddy rice each year. The townships adjacent to the farm grow rice on a farmland area of 200,000 mu. Produce 130,000 tons of organic rice each year. The raw material is abundant.

Market Situation: Heilongjiang Land Reclamation Nenyuan Rice Co., Ltd. has set up networked outlets in more than twenty cities, such as Beijing, Daqing, Harbin, Shenzhen, Shanghai, Chengdu and Hohhot. Their annual sales volume exceeds 30,000 tons. Our products are also sent to the supermarkets in Beijing and in the Yangtze River delta zone.

6. Estimate on Investment in the Project

The total investment in this extension project will be 12 million Yuan. The construction period for this project will be one year. The investment payback period will be 4 years, with a rate of return at 25%.

7. Economic Benefits of the Project: After the project is put into production, the product sales revenue will be increased by 70 million yuan, with profit of 6 million yuan.

8. Patterns of Cooperation: Joint venture or cooperation