Agricultural Product


1 Introduction to the Project
1.1 Project Background
1.1.1 Overview of the Project
Liuhe County, located in southeast of the Changbai Mountains in Jilin Province, under the Tonghua City, is a traditional wild vitis amurensis area and the mountain is one of China's major grape-growing areas. Liuhe County wild vitis amurens have abundant resources with long history of cultivation. It mainly cultivates Gongniang One, Shuanghong, Zuoyouhong and Beibinghong etc. wine grape varieties which offer superior raw materials for the production of quality wine and has been rated "National Vitis Demonstration Zones ", “China Mountain Wine Country " one after one. Liu Heshan wine was identified as geographical indications protection products by AQSIQ. In recent years, China's wine industry developed rapidly, with the development of 30,000 acres high-quality mountain grape planting base and 25 Hill Country wine grape producers which have ISO management system certification and QS certification, reached the annual production capacity of 110 thousand liters; Surrounding Liuhe County, there are Tonghua wine Co. Ltd., the Changbai Mountain wine Group, Tontine Wines and other large wine production and processing enterprises; With the development of China's wine industry and the recovery of mountain wine industry, Tonghua areas’ demand for advanced natural oak will increase year by year. The project will have good prospects for development after putting into production throughout the Northeast.
1.1.2 Market Prospects
(1)Current development situation abroad
Large-scale developments of wineries are things of the past century, and now wineries have been around the world on five continents. The wine-producing country is no longer confined to Western Europe, the Americas, Oceania, Africa and Asia also has some wine production rising powers. International Organization of Vine and Wine OIV Chairman Jose (Dutruc) studies suggest that the international wine market will have an increasingly fierce price competition, especially in high-end wines, so it is necessary to curb the decline in traditional consuming countries and to support the amount of alcohol consumption in other countries. As an aesthetic part of the global food, culture, and environmental action, the wine producing country should integrate resources and unified communications strategy; Japanese food expert Hamano Kyrgyzstan shows that Japan's domestic wine import growth and overheating wine wave is currently facing a intemperate period and under the current context of globalization of the market economy, producing wines that  have better quality and taste than imported products, becomes the key to the survival for the Japanese domestic wineries; German expert of wine industry associations come to a conclusion through a lot of investigations that in the past 20 years, Germany has an upward trend in wine production and in order to be able to stand in a dominant position in international competition, the German wine producers follow the basic principles“ low-yield, high-quality”, sophisticated and diversified to achieve production, spreading to the world of wine and wine manufacturing technique naturally and environmentally; According to a research report puts forward by Vertumne International & Associates Company to the famous wine exhibition organization vinExpo, global wine growing area is stabilizing and wineries production and consumption will continue to grow. With 115,000 hm2 (hectares) of vineyards, 12 500 wineries and more than 400 wine distributor, there is an annual production about 720 million bottles of wine and an annual output value of 20 billion francs. These alarming data come from France's largest grape and wine region of Bordeaux. There is no doubt that Bordeaux is the world's most famous grape and wine regions and although there is a growing number of emerging areas, the French Bordeaux grape and wine is still the world's most classic template not only because she gave birth to the French wine culture, but also changed the drinking habits of many countries. Large-scale development of wineries are things of the past century, and now wineries have been around the world on five continents, the wine-producing country is no longer confined to Western Europe, the Americas, Oceania, Africa and Asia also has some wine production rising countries.
(2)The current situation of Chinese wine industry and development direction
In recent years, Chinese wine industry in production, product structure, product quality, production technology, technical equipment and product brands have undergone a fundamental change. Learned from the China Alcoholic Drinks Industry Association, by 2015, Chinese wine production will reach 0.8 million tons, maintaining an average annual growth rate of around 15%.
Chinese wine in the past was mainly liqueur with low juice content. After adjustment of product structure in recent years, China has formed a whole juice wine-based product structure, in which dry, semi-dry wines accounted for the total 50% -60%. Increasingly rich variety of high-end products, in addition to the existing internationally recognized high-end varieties of wine, the high-end sparkling wine, wine estates have also put on the market. This shows that China's wine industry on product structure adjustment has entered into a healthy and normal development stage. By the statistics, since 2005, the whole juice wine has reached more than 80 percent and 100 percent in 2015 with dry wine accounted for 50-60% of total production which has gradually improved the product quality. Wine industry technology and equipment have made great progress with the increasing international exchanges. Some of the key equipments of large domestic wineries such as stem crusher, sterilizing filter, tartar processor, and canning equipment were imported from abroad; Brewing technique also actively adopted foreign advanced brewing technology and combined with China's specific conditions which improved our wine making techniques. Currently, seven companies have reached more than ten thousand tons of wine production and 12 enterprises sales’ income is more than 0.1 billion. The total pre-tax profits of Yantai Changyu, Dynasty, Tianjin, Yantai Great Wall, Gaza City Wall, the Great Wall of China, Yantai and Qingdao, East China, these seven companies accounted for 87.66 percent of the industry. There is high concentration of the industry and company of a certain size. The wine industry has always been supported by the national industrial policy, in particular the implementation of the national wine industry "four transformations", that is high alcohol wine transition to a low degree, distilled liquor to fight hair turning entire areas of product promotion branding, in the previous successful operation of the "world's seven Helan Mountain • Grape Coast", the marketing of Helan Mountain will move in depth areas. Yinchuan municipal government attaches great importance to the grape and wine industry, as one of its four pillar industries in Yinchuan. The city government adopts a flexible, pragmatic and effective measures in the investment policy, park construction, technical support, information services, and other aspects of administrative examination and approval, attracting a group like Yantai Changyu Pioneer Wine Co., Ltd., Tianjin Sino-French joint venture Dynasty Winery Ltd. Yuma, Ningxia COFCO Great Wall Wine Co., Ltd. Yinchuan desert round wine industry, Ningxia Yong Ning Yuquan wineries, Ningxia Helan Mountain wineries, wine fermentation and wine production base stations, Helan Mountain Municipal give some preferential policies in taxation base for the establishment and development of the grape and businesses. Currently, Helan Mountain grape production advantages are clear with strong atmosphere of wine industry and a future Chinese wine city is quietly rising.
(3)Future market analysis
As we all know, China has become the world's last new world wine market, which has become the concern of the world's wine country of origin. Currently, China's wine market already contains all the old and new world wine products. The combined impact of foreign economic crisis is faster and more direct than the domestic consumption of rational factors, resulting in a plummeting consumption of foreign wine, but wine producers supplying the market did not decrease because ripe grapes can not be kept directly and wine cannot be kept for unlimited and long term, therefore, to find a new growth point of the target rests on China---the market with the greatest economic development potential.
In addition, the authentic exotic culture of wine is an important factor for attracting consumer spending and boosting market supply. For example, on the Guangzhou International Wine Exhibition and the Third World Wine Festival held at the end of November 2008, many consumers know that in addition to the traditional wine producing countries such as France, Australia and Italy, Romania, Hungary, South Africa, Portugal, Spain, Greece, Argentina, New Zealand, Chile etc. countries also produce abundant wine products, which is a good demonstration.
The 2015 market share of imported wines accounted for 10% of the entire domestic wine market, and from 2014 to 2015, the growth in the amount of wine in the Chinese market was more than 15%.
Built on the basis of the so-called brand advertising will be merciless to those alternative choices in the market realities. As we all know, the low-end wine market, wine consumption in both the current mainstream market space, but also a regional domestic wine market survival. With the increase in the supply of imported wine market brought prices fall, the imported wines with market retail price of dozens of yuan tends to become popular.
This shows that the rapid development of the wine industry creates greater living space for cork enterprises.
1.1.3 Technical Analysis
Technical aspects: Carrying out comprehensive cooperation in mountain grape breeding, cultivation and management and mountain wine production techniques, technology, etc. with Institute of Chinese academy of agricultural sciences' left home products, the northwest agriculture and forestry university of science and technology institute of wine, scientific research institution, LiuHe County wine research and development center etc. provided the scientific and technological support for the industrial development.
1.1.4 Advantageous Conditions of Project Construction
(1)Policy advantage
According to the amount of investment, it enjoys related preferential policies of “several measures of Liuhe County People's Government on encouraging investment” (Liu Zheng Fa [2010] No. 23).
(2)Regional advantage
Liuhe County is located in the Mid Changbai Mountain, its unique geography, soil and climatic conditions are suitable for the growth of Vitis, especially for ice grape cultivation. The whole county which covers 3,348 square kilometers and a population of 380,000 has jurisdiction over 12 towns and 10 rural county areas. The County People's Government is located in the Liuhe Town. Liuhe County is located in the southeastern of Jilin, north of Tonghua. Located in east with longitude 125 ° 17 '~ 126 ° 35', latitude 41 ° 54 '~ 42 ° 35', it borders Huinan County in the northeast, Baishan City Badaojiang District, Jiangyuan County and Jingyu County in the east, Meihekou City in the north, Tonghua County in the south, and is adjacent to Qingyuan County and Xinbin County in the west. The county center Liuhe Town is the political, economic and cultural center.
(3)Technical advantage
Carrying out comprehensive cooperation in mountain grape breeding, cultivation and management and mountain wine production techniques, technology, etc. with Institute of Chinese academy of agricultural sciences' left home products, the northwest agriculture and forestry university of science and technology institute of wine, scientific research institution, LiuHe County wine research and development center etc. provided the scientific and technological support for the industrial development.
(4)The advantage of the industrial base
With adequate supply of electricity, high water quality, and convenient road and rail transportation, Liuhe County has now become the "mountain grape industry business base", "national mountain grape production demonstration area", "national grape processing technology research and development branch center" and “Hometown of China Quality Mountain Wine”. There is nearly 30,000 mu mountain grape planting base in the whole county, 25 mountain-grape-wine companies have got QS certification, industry production capacity is approximately 110 thousand liters.
1.2 Content and Scale of Project Construction
1.2.1 Product Scheme
The main building of the project is the production workshop, auxiliary workshops, warehouses, administrative departments. The main building of accessories production area is the machine room (including distribution), boiler room, garage, guards and gates, total construction area of ​​700 square meters.
In addition, the iron fence in the factory is 1058 prolonged meters, with one gate, guard room and garage, greening and ground hardening etc.
1.2.2 Construction Scale
The total construction area is 3,000 square meters and the main production area includes production workshop of 1,200 square meters. The main production and office area will mainly construct office building of ​​500 square meters.
1.3 Total Investment and Financing
1.3.1 The total project investment (detailed in Table 1)
Table 1: Summary Table of the Total Investment        Unit: ten thousand yuan    
 
No.    Name of Expense    Investment Amount    Percentage to Total Investment %    Remarks      
1    Construction Investment    13000    86           
2    Interest Incurred in Construction Period    1200    8           
3    Working capital    800    6          
4    Total investment of project (1 +2 +3)    15000    100.00          
1.3.2 Financing (detailed in table 2)
Table 2:          List of Funds Raising             Unit: ten Thousand Yuan
 
Serial No.    Classification and Source of Funds    Capital Amount    Percentage to Total Investment(%)      
1    Project Capital    10000    66      
1.1    Construction Investment    13000    86      
1.2    Working Capital    800    6      
1.3    Interest incurred in construction period    1200    8      
2    Raised fund    5000    34      
2.1    Construction Investment    13000    86      
2.2    Working Capital    800    6      
3    Total Investment of Project    15000    100.00     
1.4 Total Investment and Financing
1.4.1 The Total Project Investment
Table 3: List of Main Indicators for Economic Benefits Forecast  
Unit: ten thousand yuan
 
Serial No.    Name    Unit    Indicator    Remarks      
1    Operating income    ten thousand yuan    18000    Normal year      
2    Total Profits    ten thousand yuan    5000    Normal year      
3    Financial Internal Rate of Return of All Investment    %    20    After income tax      
4    Financial Net Present Value(Ic=10%)    ten thousand yuan    10996.67    After income tax      
5    Payoff Period of All Investment (after tax)    a    5     Including construction period of one year     
1.4.2 Social Evaluation
1. After the implementation of the project, a lot of food processing raw materials and packaging materials are needed every year. It promotes the local transport, and also plays a relatively great role in local economic development, thus it has certain impact.
2. After the completion of the project, employment opportunities for local people have increased to improve the incomes of local people and improve the living standards of residents, which make a great contribution to raising the employment rate of society.
3. Implementation of the project can effectively promote the development of upstream and downstream enterprises and other related industries locally, thus contributing to the rapid development of the local economy.
1.5 Cooperation Method of Project
Joint venture. Other methods can be negotiated face to face.
1.6 What to be Invested by Foreign Party
Capital. Other methods can be negotiated face to face.
1.7 Construction Site of the Project
Liuhe County Caisheng Industrial Park
1.8 The On-going Condition of Project
Pre-project planning has been basically completed.
2、Introduction to Partner
2.1 Basic Conditions
2.1.1 Overview of Project Undertaker:
Project undertaker: Liuhe County Economic and Technical Cooperation Bureau of Jilin Province
Address: No.76 of Liuhe Street, Liuhe County, Jilin Province
Contact Person: Zhao Xiaohong  0435-7213303  13844556900
Fax:0435-7330711
Postal code: 135300
E-mail:jllhjhj@163.com

Contact Methods of Project City (Prefecture) :
Contact Unit: Tonghua Economic and Technical Cooperation Bureau
Contact Person :Liu Daoguang
Tel:0435-3650996  18904359157 
E-mail: th3650957@126.com
Website:http://www.tonghua.gov.cn/
 

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