Hu Yongqi

China Daily (Hong Kong) - - CHINA -

n 2006, Jiang Yil­iang was a fresh­man at North­west Agri­cul­ture and Forestry Univer­sity in the Yan­gling Demon­stra­tion Zone, a city in Shaanxi prov­ince renowned for agri­cul­tural re­search and tech­nol­ogy.

The only down­side to his new life was that lo­cally grown fruits lacked the vi­brant taste and fresh­ness of those from his home­town, Urumqi, the cap­i­tal of the Xinjiang Uygur au­ton­o­mous re­gion.

“As a ma­jor in en­vi­ron­men­tal sciences, I knew that dam­aged soil was one of the causes of the dif­fer­ence in taste. Soil re­me­di­a­tion is a new way of im­prov­ing the qual­ity of lo­cal fruits, and can also be used in places where soil has been dam­aged by in­dus­trial con­tam­i­na­tion or ex­ces­sive recla­ma­tion,” he said. “I wanted to do some­thing to im­prove the sit­u­a­tion.”

Nine years af­ter he grad­u­ated, Jiang be­came the founder and CEO of Xi’an Jin­hua Eco­log­i­cal Tech­nol­ogy Co, one of a num­ber of agri­cul­ture-re­lated star­tups in Yan­gling.

In the demon­stra­tion zone, star­tups are work­ing to pro­duce a range of prod­ucts and ser­vices, in­clud­ing equip­ment that mon­i­tors the mat­ing sea­sons of dairy cat­tle to im­prove milk pro­duc­tion, and drones to de­tect pests that harm plants.

Back to the land

In 2010, Jiang be­gan work­ing on soil tech­nol­ogy when he started at grad­u­ate school and was taught by a pro­fes­sor who spe­cial­ized in re­search into the “black soil” of North­east China.

In the fol­low­ing five years, Jiang trav­eled na­tion­wide to un­der­take de­tailed re­search to de­ter­mine how soil be­comes dam­aged and for­mu­late a recla­ma­tion process that would ben­e­fit farm­ers.

Jiang was con­vinced that dam­aged soil was ham­per­ing the devel­op­ment of the na­tion’s agri­cul­tural sec­tor, re­duc­ing crop yields and un­der­min­ing qual­ity. He re­al­ized that re­me­di­a­tion tech­nolo­gies could be used to help farm­ers and other play­ers in the field.

In 2015, when they dis­cov­ered that the mar­ket value of soil recla­ma­tion work was es­ti­mated to be as high as 900 bil­lion yuan ($133 bil­lion), Jiang and two other doc­toral can­di­dates es­tab­lished Jin­hua, which now has 17 full-time em­ploy­ees.

Im­pressed by the com­pany’s prospects, an in­vestor in Bei­jing pro­vided 3 mil­lion yuan, while the com­pany also gen­er­ated rev­enue by pro­vid­ing soil tests and a range of other ser­vices.

Jin­hua has de­vel­oped tech­nolo­gies that re­struc­ture dam­aged or con­tam­i­nated soil and help to re­tain wa­ter and or­ganic mat­ter. The tech­niques were used to cleanse more than 26,500 hectares of desert land used for potato cul­ti­va­tion in Shaanxi and the In­ner Mon­go­lia au­ton­o­mous re­gion.

The ex­tra wa­ter and nu­tri­ents pro­vided by the com­pany’s new tech­nolo­gies quickly helped to dou­ble crop yields to 52.5 met­ric tons per hectare.

Jiang rep­re­sented the demon­stra­tion zone’s young en­trepreneurs and de­liv­ered a re­port about lo­cal con­di­tions at a meet­ing with Premier Li Ke­qiang when he vis­ited Yan­gling ear­lier this month. In re­sponse, the premier en­cour­aged him to in­te­grate his new tech­nolo­gies with deep cul­ti­va­tion farm­ing tech­niques.

Ac­cord­ing to Li Guox­i­ang, who re­searches ru­ral devel­op­ment at the Chi­nese Academy of So­cial Sciences, China is fac­ing an agri­cul­tural dilemma; grain har­vests have risen steadily in re­cent years, but most high-qual­ity pro­duce is im­ported. He be­lieves that new tech­nolo­gies and busi­ness mod­els can bridge the sup­ply gap and im­prove the qual­ity of pro­duce.

Govern­ment sup­port

Yan­gling, fa­mous na­tion­ally for its agri­cul­tural and forestry tech­nolo­gies, was es­tab­lished as the coun­try’s first na­tional demon­stra­tion zone for agri­cul­tural tech­nolo­gies about 20 years ago. It is also China’s only pi­lot free trade area for agri­cul­ture.

As a re­sult, the city at­tracts a large num­ber of re­searchers and aca­demics, which highlights the role of North­west Agri­cul­ture and Forestry Univer­sity. By the start of this month, its re­searchers had reg­is­tered more than 1,200 patents re­lated to agri­cul­ture, mak­ing the univer­sity a leader in the field.

The new tech­nolo­gies have prompted dra­matic changes in the agri­cul­tural sec­tor.

For ex­am­ple, last year, five farm­ers in Yan­gling pooled their re­sources to raise 105 mil­lion yuan, and used new drip and sprin­kler ir­ri­ga­tion tech­niques in 80 green­houses where they grew wa­ter­mel­ons and trop­i­cal fruits.

The new tech­niques saved wa­ter and the green­houses pro­vided a trop­i­cal en­vi­ron­ment that greatly im­proved the taste of the pro­duce, which rapidly be­came pop­u­lar with con­sumers.

An­other lo­cal startup, Yan­gling Agri­cul­tural Cloud Co, is the coun­try’s largest data plat­form in new fields such as smart farm­ing, pro­vid­ing ac­cu­rate in­for­ma­tion about the use of nu­tri­ents and mar­ket­ing tech­niques.

How­ever, the in­te­gra­tion of re­search and in­dus­try has proved prob­lem­atic, and lo­cal of­fi­cials con­cede that more than 90 per­cent of star­tups in Yan­gling fold be­fore they can make a profit.

North­west Agri­cul­ture and Forestry Univer­sity pro­vides star­tups with sub­si­dies rang­ing from 10,000 to 50,000 yuan, while the lo­cal govern­ment sub­si­dizes el­i­gi­ble com­pa­nies to the tune of 50,000 to 200,000 yuan each.

So far, Jin­hua has re­ceived 10,000 yuan from the univer­sity and 50,000 yuan from govern­ment funds, and was also granted 200,000 yuan by the Shaanxi Depart­ment of Sci­ence and Tech­nol­ogy to rent equip­ment at the univer­sity.

“All the sub­si­dies and as­sis­tance in­di­cate the sup­port the govern­ment has given to star­tups,” said Gao Hai­long, one of Jin­hua’s founders. “We can also ap­ply to use other govern­ment-funded projects, such as a data­base for in­dige­nous plants, which will help us to gen­er­ate more rev­enue and im­prove our chances of sur­vival.”

A long jour­ney

While Gao is op­ti­mistic, the re­al­ity is that sur­vival is a tough busi­ness, ir­re­spec­tive of the qual­ity of the new tech­nolo­gies be­ing de­vel­oped.

The demon­stra­tion zone is home to thou­sands of agrotech­nol­ogy star­tups, but many will never make a profit in the short-term as a re­sult of prob­lems re­lated to fund­ing and mar­ket­ing.

Zhu Jun­qiang, gen­eral man­ager of Shaanxi Zhongxin Tech­no­log­i­cal Co, has reg­is­tered 13 patents to cul­ti­vate eu­com­mia ul­moides, com­monly known as the hardy rub­ber tree, whose bark and leaves con­tain el­e­ments that are highly val­ued in tra­di­tional Chi­nese medicine.

Us­ing the patents as a base for his busi­ness, Zhu de­cided to build a fac­tory.

In 2014, he re­ceived fund­ing from a real es­tate de­vel­oper in Xi’an, which en­abled him to hire work­ers to break down leaves and bark col­lected in the Qin­ling Moun­tains in Shaanxi. The re­sul­tant pow­der was ex­ported to Ja­pan as a food source.

Al­though Zhu made about 1.3 mil­lion yuan a month in his first year, the money didn’t roll in fast enough for the de­vel­oper. At the end of the year, he with­drew his fund­ing, with the re­sult that Zhu’s first startup failed, even though his prod­ucts were highly prized over­seas.

The blow taught Zhu that in ad­di­tion to a busi­ness plan, solid fund­ing and a so­phis­ti­cated in­dus­try chain are es­sen­tial el­e­ments for star­tups.

Last year, when the State Forestry Ad­min­is­tra­tion an­nounced that 2 mil­lion hectares na­tion­wide would be sown with eu­com­mia ul­moides by 2030, the busi­ness po­ten­tial spurred Zhu and his older brother, Zhu Mingqiang, to keep their busi­ness in op­er­a­tion.

The an­nounce­ment came at ex­actly the right time for the broth­ers be­cause they had started a crowd­fund­ing project late in 2015 that raised 65 mil­lion yuan.

In ad­di­tion to fi­nanc­ing Zhu Jun­qiang’s fac­tory, they rented 1,320 hectares of land in Xinjiang on which they planted eu­com­mia ul­moides. The fledg­ling trees were eas­ier to han­dle than those in the Qin­ling Moun­tains, which grow to a height of more than 2.5 me­ters, mak­ing it dif­fi­cult to strip the leaves and bark.

The farm is easy to man­age and the abun­dant sun­light in Xinjiang helps to pro­duce higher yields, ac­cord­ing to Zhu Jun­qiang.

Now, the broth­ers make a net profit by ex­port­ing eu­com­mia tea, and they plan to de­velop a range of prod­ucts, such as glues made from the plant.

Sur­vival

“I failed once as a re­sult of fi­nan­cial prob­lems, so now we are very cau­tious about the cap­i­tal chain,” Zhu Mingqiang said.

Li Guox­i­ang, the CASS re­searcher, warned that agri­cul­tural star­tups and in­no­va­tions take time to de­velop, and there­fore early sur­vival is the key to long-term suc­cess.

“Ru­ral ar­eas are less de­vel­oped than cities be­cause of a lack of in­fra­struc­ture and tal­ent,” he said. “Many in­vestors seem less in­ter­ested in agri­cul­tural star­tups than other fields, such as the fi­nan­cial sec­tor, be­cause it’s im­pos­si­ble to make quick prof­its. That low­ers the chances of sur­vival, so young peo­ple should be aware of this when they start busi­nesses.”

Con­tact the writer at huy­ongqi@chi­nadaily.com.cn

Jiang Yi­lang, co­founder and CEO of Xi’an Jin­hua Eco­log­i­cal Tech­nol­ogy Co, checks soil tem­per­a­tures in a green­house.

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