China Green Agriculture, Inc. Announces Grand Opening of New 40,000-Ton Capacity Production Facility
Release Date: 2009-09-01
Total Annual Capacity Increases to 55,000 Metric Tons of FertilizerXI'AN, China, Aug. 31 /PRNewswire-Asia-FirstCall/ -- China Green Agriculture, Inc. (NYSE Amex: CGA; "China Green Agriculture" or "the Company"), a leading producer and distributor of humic acid ("HA") based green fertilizer through its wholly owned subsidiary, Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd., today announced the grand opening of its newest production facility in X'ian, China. The announcement of the new facility was made in May 2008 and the facility began formal production in August 2009.
China Green Agriculture held its grand opening ceremony for the 40,000 ton production line adjacent to its existing 15,000 ton facility on August 28, 2009. The new facility increases the Company's production capacity from 15,000 tons per year to 55,000 tons per year to meet the growing demand for its green fertilizer products. China Green Agriculture was the first company in China to build a fully automated manufacturing system which precisely measures and mixes key ingredients to formulate its unique fertilizer products. While the Company's current facility incorporates a high degree of automation, new automated equipment has been added in the new factory, which increases efficiency and further reduces reliance on manual labor. These advanced production techniques reduce waste which in turn reduces costs.
In addition, China Green Agriculture is the first company to install a fully integrated quality control system with mobile wireless monitoring which enables the Company to closely supervise its production process in the new facility. China Green Agriculture currently only manufactures liquid fertilizer products; however the new facility is capable of producing both liquid and highly concentrated fertilizer (i.e. powder fertilizer) and is also the first fertilizer manufacturer in China to apply microwave technology to its production of highly concentrated fertilizer.
China Green Agriculture's new facilities include 27 vats for mixing ingredients and pharmaceutical grade, electronically calibrated measuring equipment spread over approximately 148,000 square feet. The Company expects to reach full utilization of its 55,000 metric ton capacity over the next three years. Sales volume is expected to increase 40-45% with a utilization rate of 35%-38% by the end of the fiscal year 2010. Formal guidance for fiscal year 2010 will be provided by management with the fourth quarter and fiscal year 2009 earnings announcement scheduled for mid-September.
"Based on the growing market demand for our green fertilizer products coupled with our extensive distribution network, we expect that our increased capacity will be rapidly absorbed by the Chinese fertilizer market. This facility will be our growth driver for the fiscal year ending June 30, 2010, allowing us to meet our revenue and net income targets," commented Mr. Tao Li, Chairman and CEO of China Green Agriculture. "We continue to see strong demand within the 27 provinces that we cover, as the Chinese government seeks to increase farmers' income and boost the growth of diversified crops, especially for organic food. By leveraging our new facility we are well positioned to gain further market share in China's fertilizer market."
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