Muyuan Pig

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Mu Yuan Foodstuff Co, Ltd (‘Mu Yuan” or “the Project”) is a large-scale, integrated, farrow-to-finish intensive pig breeder and hog producer located in Neixiang County, Henan Province, China. While the first hog farm was established in 1992, the business has seen progressive expansion (with the most rapid increase occurring in the period 2004-2006 when seven new farms were established). Currently Mu Yuan operates 17 farms including an experimental station, boar station, breeder farms (great grandparent, grandparent and parent farms) and hog farms, with the latter having an annual production capacity of 450,000 hogs. The farms occupy a total area of 135 ha, with individual farm sizes ranging from 1.3 ha to 17.5 ha. In addition the Mu Yuan operates two feed mills (including a feed mill located in Guanzhang Town completed in late 2008) with an annual production capacity of 400,000 tons. Finally in 2009 Mu Yuan partnered with Shandong Longda Group Limited (Longda) to establish a slaughter house with a processing capacity of 1 million hogs per year (i.e., 3,000 hogs/day) although currently it is only processing 500 hogs/day. The slaughter house is a dedicated facility designed to process only Mu Yuan pigs. Mu Yuan owns a 40% stake. Individual farms are located distant from local communities in rural areas in Neixiang County. The majority of the land area of each farm is occupied by units housing pigs. Pigs are provided with on-demand feed and water, the former deriving from silos located outside each unit. Pigs are provided with slatted floors allowing for the collection and storage of solid waste and urine below the unit with subsequent flushing to biogas digestors. In summer cooling is provided by the operation of ceiling fans and opening of shutters allowing air to move through the unit and exit through a ventilation shaft. In winter heating is provided by heated water heated by small coal-fired boilers and pumped through a ground level piping system. Farms also have offices, accommodation and a canteen. IFC financing comprises an equity investment in the company. Financing from IFC will support an expansion plan that will include: two commercial hog farms with an annual capacity of producing 120,000 and 180,000 hogs respectively, and (ii) a 15,000 hog breeder farm with an adjacent commercial hog farm with a capacity of 300,000 hogs. Upon completion, this project would expand Mu Yuan’s annual hog production capacity to 1 million. The company is ambitious in growing its hog production capability to 4 million by the year 2014 with farms to be located outside of Neixiang County.