AgroPages-Fengle Agrochemical newly builds three pesticide formulation production lines-Agricultural news

By Think Real - On 20 Aug., 2016, Hefei Fengle Seed Co., Ltd. (Fengle Seed) published a notice saying that it approved the USD6.5 million of investment from its pesticide subsidiary, namely Anhui Fengle Agrochemical Co., Ltd. (Fengle Agrochemical), about the new building of three pesticide formulation production lines in the factory of the Feidong Circular Economic Park in Hefei City, Anhui Province.

According to Fengle Seed, the Land Bureau of Feixi County, Hefei, purchased the land use right of one factory of it in 2015. After that, the production lines of the factory stopped production, resulting in the capacity reduction of 4,000t/a (including 700t/a of powder, 1,100t/a of SC and seed coating agents, as well as 2,000t/a of EC and AS) of pesticide formulations of Fengle Agrochemical and bringing negative effect on the development of the company’s agrochemical business. As shown in the annual report, the revenue from the business was USD69.8 million in 2015, slipping by 13.7% year on year; its net profit was even -USD0.67 million.

After market research and argument, Fengle Seed agreed the USD6.5 million investment of Fengle Agrochemical into the new building of three formulation production lines, among which construction investment and capital flow are USD6.0 million and USD550,601.3 respectively. With the construction period of five months, the project will build 2,000t/a for powder (mainly 75% tribenuron-methyl, 75% thifensulfuron-methyl and 75% nicosulfuron), 1,000t/a seed coating agents and 100t/a CJ.

In addition, the notice also said that to optimize its resource allocation, the company plans to rip off its minority businesses with low efficiency, namely quitting the hotel service industry and shut down its subsidiary Anhui Fengle Hotel Co., Ltd. and treat its assets properly.