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The Business of Feeding China
Gateway to the future of China's Agribusiness
China Global Advisory, a Hong Kong corporation has secured an exclusive five year agreement with the China Association of Agricultural Science Societies (CAASS). This former central government association will act as investment analysts, management consultants, and sourcing agents providing due diligence on target investment agribusiness opportunities for all of China via their national network. Through this China Global Advisory platform, investment funds will be able to pick the most attractive first tier agribusiness projects for their investors through various vehicles including mergers and acquisitions. Higher rates of return through safer investments from trustworthy sources are the benefit of this platform.
The challenges faced by the agribusiness sector in China are:
- Primitive Technology – some products are cheaper to import than to produce domestically. This includes some of the basic grains which causes concerns.
- Poor Management – most agribusiness are founded by farmers who have little or no management training. Therefore, their effective competitiveness is diminished.
- Lack of Capital – most funds chase after the high profile investments (i.e. IT, telecom) while ignoring this sector which is the largest single source of GDP.
- Inefficient farming – individual farmers, without alternative ways to earn a living, are stuck to their little plot of land. This causes enormous inefficiencies with yields per acre that are just a fraction of what could and should be produced.
- Historical concerns of Funds investing in China
a. Inability to source quality projects
b. High cost of penetration into the market-need to hire staff who understand and can perform due diligence on potential investments
c. Unreliable information
- Historical issues facing foreign companies wishing to gain entrance into China
a. Lack of understanding of the market
b. Inability to locate a reliable local partner
c. Inability to access credible information
CAASS’ vision is to have China Global Advisory develop a platform for foreign non-government organizations (NGOs) and enterprises that wish to have access to the agribusiness market in China utilizing CAASS’ vast network, expertise, resources and government support. To accomplish these goals, CAASS has appointed China Global Advisory’s CEO Billy Hong as its international liaison.
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We base business ideas on circumstances that are not just probable, but inevitable. China’s increasing demand for food brought on by continuing population growth, leads to a subsequent shortage of arable land. In addition, as China’s population attains more wealth, they will demand to eat better. These factors mean that companies in the food processing industry will prosper. Therefore, an increasing number of global entities will aggressively pursue entry into China’s agribusiness market. |
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