BEIJING, April 17,
2023 /PRNewswire/ -- Origin Agritech Ltd.
(NASDAQ: SEED) (the "Company" or "Origin"), announced today
that its majority owned joint venture has signed a deal with
Shihezi city in Xinjiang, under which the JV will be granted
200,000 mu (roughly 33,000 acre) of farm land for growing NEC
corn.
Origin's minority partner in the JV is a regional farming and
feedstock company. The JV partner is responsible for financing,
both with its own funds and with bank financing, the contract
growing of NEC corn and for the construction of a grain processing
facility that will dry and silo the corn. The JV partner has signed
offtake agreements for the purchase of the NEC corn grown by the
JV. Origin Agritech will sell the NEC corn seed to the joint
venture and will provide planting support services.
The JV has planted 30,000 mu for this season and plans to expand
planting to the whole 200,000 mu for the 2024 season. An
engineering firm that builds grain processing facilities has been
retained and is designing the facility and preparing the project
plan for construction.
Shehezi government officials cited the superior nutritional
yield of Origin's NEC corn, allowing hogs to thrive without the
expensive soybean meal supplementation needed with every other corn
variety, as a major reason for wanting to work with Origin.
Origin expects that this deal will add $8
million to revenue in 2023 increasing to $55 million in 2024 as the growing area is
expanded to the full 200,000 mu. Since Origin is not
responsible for any of the capital costs of the project, neither
financing the contract growing, nor funding the construction of the
grain processing facility, the Company will not need to raise
capital to fund this growth.
"We are thrilled to help ensure food security for Xinjiang by
expanding production of our revolutionary NEC corn in the region,"
said Origin Agritech's Chairman Gangchen Han. "In 2022 extreme
covid lockdowns in the regions where we were looking to expand NEC
production forced us to postpone our expansion. As is evident by
this new deal, that growth was delayed but did not disappear. Every
feedstock company that we have sent samples of NEC corn to has
independently verified the superior nutritional content and is very
interested in buying it from us. Now it is just about logistics and
execution of expansion of production with deals like this one."
About Origin Agritech Limited
Origin Agritech Limited, founded in 1997 and headquartered in
Zhong-Guan-Cun (ZGC) Life Science Park in Beijing, is a leading Chinese agricultural
technology company. In crop seed biotechnologies, Origin Agritech's
phytase corn was the first transgenic corn to receive the
Bio-Safety Certificate from China's Ministry of Agriculture. Over the
years, Origin has established a robust biotechnology seed pipeline
including products with glyphosate tolerance and pest resistance
(Bt) traits. For further information, please visit the Company's
website at www.originagritech.com. The company also maintains a
twitter account for updating investors on company and industry
developments, which is @origin_agritech.
Forward-Looking Statements
This communication contains "forward-looking statements" as
defined in the federal securities laws, including Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended, and as defined in the U.S.
Private Securities Litigation Reform Act of 1995. Forward-looking
statements address expected future business and financial
performance and financial condition, and contain words like
"expect," "anticipate," "intend," "plan," "believe," "seek,"
"will," "would," "target," and similar expressions and variations.
Forward-looking statements address matters that are uncertain.
Forward-looking statements are not guarantees of future performance
and are based on assumptions and expectations which may not be
realized. They are based on management's current expectations,
assumptions, estimates and projections about the Company and the
industry in which the Company operates but involve a number of
risks and uncertainties, many of which are beyond the company's
control. Some of the important factors that could cause the
company's actual results to differ materially from those discussed
in forward-looking statements are: failure to develop and market
new products and optimally manage product life cycles; ability to
respond to market acceptance, rules, regulations and policies
affecting our products; failure to appropriately manage process
safety and product stewardship issues; changes in laws and
regulations or political conditions; global economic and capital
markets conditions, such as inflation, interest and currency
exchange rates; business or supply disruptions; natural disasters
and weather events and patterns; ability to protect and enforce the
company's intellectual property rights; and separation of
underperforming or non-strategic assets or businesses. The company
undertakes no duty or obligation to publicly revise or update any
forward-looking statements as a result of future developments, or
new information or otherwise, should circumstances change, except
as otherwise required by securities and other applicable
laws. Although the Company believes that the
expectations expressed in these forward-looking statements are
reasonable, it cannot assure you that such expectations will turn
out to be correct, and actual results may differ materially from
the anticipated results. You are urged to consider these factors
carefully in evaluating the forward-looking statements contained
herein and are cautioned not to place undue reliance on such
forward-looking statements, which are qualified in their entirety
by these cautionary statements.
Joe Ramelli
VP of Business Development
Phone: 310-845-6238
Email: joe@originagritech.com
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SOURCE Origin Agritech Limited