1. Introduction to the Project

1.1 Project background

1.1.1 Product introduction

As an emerging international health food and healthcare market, China has maintained a good development momentum in recent years, presenting enormous market vitality and development space. With the current trend of a new round of health and wellness in China, the market potential is considerable. Traditional nourishing and health products, as well as nutritious foods, are constantly enriching this market.

The project is planned to be built in the Yanji International Airport Economic Development Zone in Jilin Province, relying on the abundant medicinal plant resources and strong foundation of the health food industry in the local area. It aims to construct a large-scale production project for ginseng and natto health products, with the main products being ginseng drinks, natto, and purified ginseng tablets.

1.1.2 Market prospects

(1) Development Status of Ginseng Industry

Ginseng, also known as "Ren Xian", "Gui Gai", "Yu Jing", "Shen Cao", "Di Jing", "Huang Jing", "Tu Jing", "Hai Er Shen", "Bang Chui", etc., is a perennial perennial herbaceous plant in the family Araliaceae.  It prefers a cool and humid climate and grows mostly in coniferous and broad-leaved mixed forests or mixed forests on gentle slopes or slopes at an altitude of 500-1,100 meters with small temperature differences between day and night. Due to its enlarged roots, spindle like shape, and often branching, it resembles the head, hands, feet, and limbs of a human, hence it is called ginseng. Ginseng is divided into wild ginseng and artificially cultivated ginseng. 95% of ginseng on the market is artificially cultivated ginseng, and wild ginseng is relatively rare. Artificially cultivated ginseng is divided into under-story ginseng, forest ginseng, and non forest ginseng according to different planting methods.  According to the processing method, ginseng can be divided into fresh ginseng, red ginseng, and vigorous ginseng.

The upstream of the ginseng industry chain is mainly ginseng planting, with ginseng farmers and ginseng planting enterprises as the main players. The middle reaches are ginseng processing enterprises, mainly including ginseng initial processing enterprises and ginseng deep processing enterprises. The downstream of the industry mainly includes two categories: traditional Chinese medicine enterprises and ginseng product consumers. Among them, traditional Chinese medicine enterprises use ginseng as a raw material for drugs, while consumers directly use various ginseng products, including ginseng food, health products, cosmetics, etc.

Ginseng is known as the "King of Hundred Herbs" and "Oriental Divine Grass" due to its magical medicinal and health benefits. It is a dual-use herb with high medicinal value. In addition to being widely used in formula medicine, it has also entered various fields such as health products, cosmetics, food, beverages, gifts, ginseng cigarettes, ginseng wine, ginseng sugar, ginseng tea, etc. In recent years, global ginseng production has steadily increased. By 2024, the global ginseng production reached about 80000 tons. Currently, ginseng is mainly produced in seven countries including R.O.K., D.P.R.K., Russia, the United States, Canada, Japan, and China, with China accounting for more than 80% of the global production.

Ginseng has a long history of medicinal use in China, and it is an essential supplement for ancient emperors and nobles to prolong life and maintain health care. Nowadays, with the improvement of people's living standards, it is very common for people to eat ginseng for health care. In recent years, the production and sales of ginseng in China have maintained a growth trend. In 2021, the output of fresh ginseng in China reached 69850 tons, of which, Jilin accounted for 56.78%, Heilongjiang accounted for 28.63%, Liaoning accounted for 7.37%, and the demand reached 70,031.9 tons. In 2023, the output and demand of fresh ginseng in China reached 76,234 tons and 75,614.4 tons respectively.

The huge market demand has promoted the continuous expansion of the Chinese ginseng market. In 2021, the market size of Chinese fresh ginseng reached 8.502 billion yuan, of which 93.3% will be domestic products and 6.7% will be imported products. With the continuous improvement of the living standard of Chinese residents, people will pay more attention to their own and their families' health conditions, so that health care and health care will become one of the development trends of urban life. Under this background, all kinds of ginseng food and health care products will enter more and more families and become the health care preference of more people. It is estimated that the market size of Chinese fresh ginseng will exceed 10 billion RMB yuan in 2025, and the market size of Chinese ginseng will further expand in the future.

(2) Market Prospect Analysis of Ginseng Health Products

Ginseng, as an important component of traditional Chinese medicinal herbs, has a long history of medicinal value and cultural significance. Modern scientific research has revealed the saponins, polysaccharides, proteins, and amino acids contained in ginseng, which have been proven to have multiple biological activities such as regulating the immune system, anti myocardial ischemia, antioxidation, delaying neurodegenerative diseases, and anti-aging.

China has achieved success in the cultivation of ginseng varieties through independent cultivation, which marks the self-reliance and high quality of the industry's basic raw materials. With the gradual establishment and improvement of the regulatory system for health food, the industry is gradually moving towards standardization, enhancing consumers' confidence in ginseng based health food.

In terms of market demand, health food is gradually gaining widespread recognition as an effective means of preventing diseases and promoting health.  Due to the precious and nourishing properties of its raw materials, ginseng based health foods have a dual advantage that drives the steady expansion of the industry. According to market research data, from 2019 to 2024, the market size of ginseng health food industry in China will grow from 10.415 billion RMB yuan to 12.139 billion RMB yuan, with a compound annual growth rate of 3.90%. Looking ahead, it is expected that the market size will further grow to 15.104 billion RMB yuan from 2025 to 2028, with a compound annual growth rate of 4.70%.

As a sub segment of the health food market, the ginseng beverage market also has a very broad future prospect. As consumers' emphasis on health care continues to increase, the demand for ginseng drinks will also continue to grow. The advancement of technology and in-depth research will provide more scientific basis for the development of ginseng drinks, promoting product innovation and diversification.

In terms of project implementation, there is enormous potential for development in terms of market demand, resource conditions, and technological innovation. With the increasing awareness of health among people, the market demand for health food and solid beverages continues to expand, providing a b=road market space for this project. At the same time, regions such as Antu County have abundant agricultural resources, such as high-quality Chinese medicinal herbs, fruits, vegetables, and unique mountainous water resources, providing high-quality raw material guarantees for the production of high-quality food. In terms of technological innovation, the project actively introduces and applies advanced production technology and management experience, increases research and development investment, strengthens technological innovation and product development, and continuously improves product quality and competitiveness. In addition, we will carry out industry university research cooperation with universities, research institutions, etc., promote the transformation and application of scientific and technological achievements, and provide technological support for the long-term development of the project.

In summary, this project is not only expected to become a new engine for regional economic development, but also to create more employment opportunities and economic benefits for local residents, promoting social harmony and economic prosperity.

1.1.3 Advantageous conditions of project construction

(1) Policy advantages

The Notice of the General Office of the State Council on Printing and Distributing the Implementation Plan of the Major Project for the Revitalization and Development of Traditional Chinese Medicine stressed that, focusing on the whole process of planting, production and use of traditional Chinese medicine, we should give full play to the role of science and technology to support and guide the development of the seed industry of traditional Chinese medicine, vigorously promote the standardized planting of traditional Chinese medicine, improve the quality of traditional Chinese medicine decoction pieces and traditional Chinese patent medicines and simple preparations, and promote the high-quality development of the traditional Chinese medicine industry.

The "Opinions of the People's Government of Jilin Province on Accelerating the Development of Agricultural Product Processing Industry and Food Industry" points out that it is necessary to build a ginseng (traditional Chinese medicine) industry cluster, vigorously research and develop products such as food, health food, and new drugs, build a well-known northern medicine base at home and abroad, and accelerate the cultivation of a ginseng industry worth billions of RMB yuan.  Encourage large enterprises to cooperate with similar enterprises through acquisitions, joint ventures, and other means, and increase the integration of brands such as ginseng, deer products, edible mushrooms, and wine.  Continuously building Jilin rice, Jilin fresh corn, Jilin miscellaneous grains and beans, Jilin Changbai Mountain ginseng, Jilin Changbai Mountain black fungus, Jilin high-quality livestock products, Jilin sika deer and other agricultural product brands with domestic and international market influence and competitiveness.  By the end of the 14th Five Year Plan, the total number of green, organic, and geographical indication agricultural products will reach 2000, the number of regional public brands will reach 100, the number of enterprise brands will be 200, and the number of product brands will be 300.

(2) Location advantage

Yanbian is located at the border of China, Russia, and D.P.R.K., with a total border length of 768.5 kilometers. Located near the Sea of Japan, the Tumen River is the only waterway in China that leads to the Sea of Japan. With Hunchun as the core, there are 10 excellent ports in Russia, D.P.R.K. and other countries distributed around a straight-line distance of less than 200 kilometers. There are 11 ports for Russia and D.P.R.K. and 1 international airport in the state, with an annual cargo capacity of 6.1 million tons and a passenger capacity of 2.9 million people. It is one of the few border areas in the country that also offers tourism to multiple countries.

(3) Resource advantage

The existing area of preserved ginseng under forest in Yanbian Prefecture has reached 116,000 mu. In the first half of this year, an additional 1920 mu of ginseng was planted under forest. The only "International Ginseng Brand Center" in China has officially settled in Yanji International Airport Economic Development Zone, Jilin, which will help accelerate the internationalization of ginseng brands in Yanzhou. The number of ginseng products authorized to use the geographical indication trademark "Changbai Mountain Ginseng" in the whole province has increased from 80 to 104, accounting for more than 50% of the total number in the province.

1.2 Contents and scale of project construction

1.2.1 Product Scale

Annual production of 50 tons of ginseng beverage, 20 tons of natto, 15 tons of purified ginseng tablets, and 5 tons of ginseng products.

1.2.2 Project Construction Content

The total area of the project is 30,000 square meters, with a building area of 25,000 square meters. Establish three production lines for ginseng beverage, natto, ginseng purification and tablet pressing, and ginseng products.

1.3 Total Investment and Fundraising of the Project

The total investment of the project is 300 million yuan, including a construction investment of 240 million yuan.

1.4 Financial analysis and social evaluation

1.4.1 Main financial indexes

After the project reaches its production capacity, the annual sales revenue is 163.93 million yuan, the profit is 49.18 million yuan, the investment payback period is 7.1 years (after tax, including 1 year of construction period), and the investment profit margin is 16.39%.

Note: “10 thousand yuan” in the table is in RMB.

1.4.2 Social evaluation

The project has effectively enhanced the added value of agricultural products such as ginseng and natto through the extension of the industrial chain, promoting the development of related industries.  In terms of social benefits, the project meets market demand, improves national health, increases farmers' income, improves people's livelihoods, promotes urban-rural integration development, and narrows regional disparities.  In summary, the processing project of ginseng and natto health products in Yanbian Prefecture has achieved positive comprehensive benefits in social evaluation, which is of great significance for local economic development and the improvement of people's living standards.

1.5 Cooperative way

Sole proprietorship, joint venture, and cooperation

1.6 What to be invested by the foreign party

Funds or other means can be discussed in person

1.7 Construction site of the project

Jilin Yanji International Airport Economic Development Zone

1.8 Progress of the project

The project proposal has been prepared

2. Introduction to the Partner

2.1 Basic Information

Name: Commerce Bureau of Yanji International Airport Economic Development Zone, Jilin Province

Address: Yansan Highway Bonded Building, Yanji City, Yanbian Korean Autonomous Prefecture

2.2 Overview

Yanji City is located in the eastern part of Jilin Province and is the capital of Yanbian Korean Autonomous Prefecture. The city covers an area of 1,748 square kilometers and has jurisdiction over 6 streets and 4 towns. The registered residence population of the city is 541,300, and the Korean population is 308,400, accounting for 57% of the total population. With an urbanization level of over 90%, it is a livable and open tourism center city with Korean ethnic characteristics, mainly focused on industry, commerce, and tourism. Its comprehensive strength ranks first among all counties (cities) in the province, and it is the only one among the top 100 counties (cities) in Jilin Province. It has won more than 150 national honorary titles such as "National Advanced County (City, District, Banner) Party Committee for Striving for Excellence".

Yanji is a distinctive central city that has accumulated wealth and developed steadily.  Over the years, under the shining light of the Party's ethnic policies, Yanji has made significant progress in its economy and various social undertakings. Its comprehensive economic strength has always ranked first among counties (cities) in Jilin Province, and its competitiveness has continued to rise among the top 100 in the country. At present, Yanji is planning to promote the construction of the "Five Parks and One Base" industry, namely the Tobacco Industry Park, Science and Technology Innovation Park, Ginseng Industry Park, Food Industry Park, and Logistics Industry Park.  The "One Base", also known as the Aodong National Pharmaceutical Base, plans to build the tobacco industry park, ginseng industry park, and science and technology innovation park, which have great potential, into parks with an annual output value exceeding 10 billion RMB yuan within 3-5 years, promoting the overall development level of Yanji's industry. As the development cooperation of the Tumen River Basin continues to heat up, the development and opening up of Changji is further promoted, and the "the Belt and Road" initiative is implemented, the development potential of Yanji will be fully released, and a livable tourism open central city with national characteristics in the Tumen River region will attract more and more investors to extend investment and win-win development.

2.3 Contact information

2.3.1 Project Contact Information:

Contact unit: Commerce Bureau of Yanji International Airport Economic Development Zone, Jilin Province

Contact perso: Wang Weijia

Tel: +86-433-2428812

E-mail: yjkgswj@163.com

2.3.2 Contact person of the city (prefecture) where the project is located:

Contact unit: Yanbian Prefecture Bureau of Commerce

Contact person: Li Jingyu

Tel: +86-13596515933