The Shanghai, PRC-headquartered Nisun International Enterprise Development Group announced on April 6 that its Henan Fintech affiliate has entered into an agricultural trade management services agreement with Henan Furun Food Co. (HFF) to increase its presence and explore growth opportunities in the pork market.
Established in 2004, HFF’s main business is the production quick frozen rice and flour products including dumplings, frozen vegetables and other agricultural side products. With registered capital of RMB 100 million and 1,100 employees, its production capacity is 50,000 tons per annum.
According to Statista, China has the largest hog herd in the world and accounts for more than a half of the global pig population. Around 60 percent of the PRC’s entire meat industry output is pork, which is also by far the most consumed type of meat in the national diet. The domestic per capita consumption of pork is the highest among all meat products and is expected to increase. In order to meet growing demand, China imports over a million metric tons of pork annually.
Under terms of Nisun’s agreement, Henan Fintech will purchase pork from Henan Guiyou Industrial Group based on orders from HFF, with full payment for the pork, while HFF provides a 30% deposit with Henan Fintech. The meat will be delivered to Henan Fintech’s designated warehouse, and upon order completion and payment, the company will arrange for the products to be delivered to specified locations or customers. Additionally, pursuant to the deal, Fintech has extended a revolving credit facility of RMB 30 million (approximately US $4.4 million) to HFF.
Xiaoyun Huang, chief executive officer of Nisun, commented: “We are thrilled to venture into the extensive and stable pork market. Our business collaboration with HFF will enable us to tap into this substantial market with great potential, while also promoting the growth of our supply chain operations. As we look ahead, we plan to further expand our presence in the pork market and enhance our supply chain capabilities. We are confident that this endeavor will increase our supply chain’s exposure to an extremely promising sector, ultimately delivering long-term value for our shareholders.”