Foxconn signs ginseng deal in Wausau
Foxconn Technology Group signed an agreement Tuesday with Wausau-area ginseng interests to develop Wisconsin’s ginseng industry and grow Foxconn’s newly established brand of the root, which is widely used in Asia as an herbal remedy.
The agreement, which Foxconn signaled more than a year ago, is with the Ginseng Board of Wisconsin and Hsu’s Ginseng, a large grower and processor based in rural Wausau.
Foxconn will provide “high-end inspection technology and production capabilities,” while Hsu’s will be the main supplier of ginseng for Foxconn’s Hong Seng brand.
In July 2017, shortly after announcing that it had chosen Wisconsin as the site of a planned $10 billion electronics factory, Foxconn signed a letter of intent with the Ginseng Board to help state growers of the root get their product to more markets in Asia and the Pacific.
Two months ago, after participating in the formal groundbreaking for Foxconn’s manufacturing complex in Racine County, Foxconn Chairman Terry Gou paid an unannounced visit to Wausau and Hsu’s. Gou uses ginseng, as do members of his family.
Charlie Alvarez, vice president of the North American hub of Foxconn health technology business group, said the partnership will allow the ginseng products made in Wisconsin to be sold not only in Asia, but the U.S. as well. Foxconn also is partnering with the University of Wisconsin Carbone Cancer Center to allow for research into use of the herb in cancer prevention and treatment.
“There are a lot of great medicinal reasons that people use ginseng,” Alvarez said at the conference. “And we’re partnering and looking at what some of those benefits can be.”
Wisconsin dominates U.S. ginseng production, and the state’s root is highly valued in Asian markets. The great majority of Wisconsin’s crop is grown in Marathon County.
While the state is a major force in ginseng, however, the industry is relatively small. Last year, Wisconsin exports of ginseng — almost the entire crop is exported — brought in $30.4 million. Wisconsin milk production, meanwhile, was worth nearly $5.5 billion.
Foxconn also said it had struck an agreement to establish a joint venture to promote sales of the Hong Seng brand in China. The agreement is with HOPU Investment Management Co., a Chinese private equity firm.
Meanwhile, Wisconsin Gov. Scott Walker said Tuesday he believes Foxconn will “far exceed” the commitments it made to the state in exchange for nearly $3 billion in refundable tax credits.
Speaking at the ginseng signing ceremony in Wausau, Walker referred to the deal the state struck with the company last year to build the $10 billion manufacturing campus in Mount Pleasant and create 13,000 Wisconsin jobs.
“To receive any of the tax credits, they have to make the actual dollar investments, and they have to create the jobs, which I believe they’ll far exceed,” Walker said.
The governor is running for re-election, and the state’s agreement with Foxconn — by far the biggest incentive subsidy package for a private company in Wisconsin history — has been a campaign issue.
A representative of Tony Evers, Walker’s Democratic challenger and the state superintendent of schools, was not immediately available to respond to Walker’s remarks Tuesday.
The latest Marquette University Law School poll, released Tuesday, shows Evers leading Walker by five points. Meanwhile, 48 percent of registered voters said they think the state is paying more than the Foxconn plant is worth, against 39 percent who think the complex will provide at least as much value as the state is investing.