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| AGRI-PRODUCTS BUSINESS |
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The Group began trading fruits imported from countries like New Zealand and Australia as early as 2002. This was a move to capitalize on the effects of seasonality and bring “in season” fruits to China from the Southern Hemisphere during the winter months. (Fruits up until then had mostly come from Northern Hemisphere countries).
Since then we have been evolving the business, building infrastructure (Our cold chain logistics network, desperately missing in China at that time), and the internal core competencies to compete in the domestic fruit and vegetable market.
Through the integrated supply chain model, the Group is better equipped to reduce the effects of market forces on our business, greatly reducing exposure to pricing risk, supply risk, and improved quality control. Because Heng Tai controls the food processing and cultivation, we are able to provide clients with more comfort with regards to food safety and still maintain competitive pricing strategies. |
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| Importance of progression up the “Product Ladder” |
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We currently have farms located in Jiangxi to cultivate citrus fruit. Our farms are supplemented by supply contracts with 3rd party farms that help us make up any shortfalls in product volume and afford us with greater varieties of products.
We diversify our business across cultivation through to food processing and trading. In the long run, we aim to explore horizontal integration looking at creating brands for our farms, self-owned e-platform and branded products.
With that said, we will adopt a conservative approach to develop the upstream farming business dependent on market demand and minimise the need for additional CAPEX. |
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| Illustration of our Integrated Agri-Products Supply Chain |
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