Supply Chain Overview


Supply Chain Overview

 

GLG’s Vertically-Integrated Supply Chain “Seed to Shelf Production”

GLG’s Vertically-Integrated Supply Chain “Seed to Shelf Production”
 
Step One
R&D Seed & Plant Development
 
Huinong 2 Patented Seeds
 
10% higher rebaudioside A content than the previous generation (H1)
The H2 strain also generates 22% more leaf per acre
GLG has upgraded its varieties company wide and has utilized Huinong 2 at all 10 of the Company’s growing bases in China for the 2011 crop season
20% greater processing efficiencies expected
100% of crop expected for harvest in 2011 has been planted using Huinong 2 seeds
 
Huinong 3 Patented Seeds
 
76% rebaudioside A content in the leaf, a 26% increase from the H1 strain
Estimated 600kg of additional stevia leaves harvested per acre, a 46% increase over H1, which improves land and resource utilization
Estimated 40% overall leaf cost improvement expected as a direct result of the increased Reb-A content and increased leaf yield
Greater processing efficiencies expected
On track for use in 2012/13
All improvements to GLG proprietary seed strains are through natural selective breeding methods and are non-GMO.
 
Step Two
Stevia Growth and Harvest
 

Secured land and farmers = Secured leaf supply
 
Long-term exclusive agreements in three of China’s largest stevia growing areas:
 
Dongtai, Jiangsu Province (10 years)
Mingguang, Anhui Province (10 years)
Juancheng, Shandong Province (20 years)
GLG is the only company allowed to grow and harvest stevia in these areas
Agricultural expansion continues and planting now extends into 10 provinces in China, including areas in Northeast China and Northwest China
 
Secured land and farmers = Secured leaf supply
 
Direct seed-to-field planting (vs. costly intermediary greenhouse step for seedlings and multiple transplantation procedures that result in decreased crop survival rate)
Hundreds of dedicated farmers
Farmer Support: Team leaders, quality control, cultivation techniques, hands on training and education, and sustainability
Strong relationships
More than 80% of the world’s stevia supply is produced in China.
 
 
China has 900 million farmers. Stevia is a high value cash crop, and increases farmer incomes, strengthening the rural economy. Chinese Government policies strongly support rural economic development in these areas.
 
Step Three
Extraction and Refining
Patented high-grade stevia primary extraction (SPE)
Able to refine all stevia with purity levels up to 99% (RA, STV, RC, etc)
Low cost production processing
Annual leaf processing capacity in excess of 41,000 metric tons. All sites have additional land available for expansion. (Currently, Runhai campus is 60 acres and Runyang campus is 80 acres)
 
Annual high-grade stevia processing capacity of 3,000 metric tons (Phase I of our Runhao campus is approximately 60 acres with access to a total of 215 acres of land which can increase capacity up to 10,000 metric tons of RA97, and Runde campus is currently 70 acres)
Third party certification including GMP, ISO, HACCP, HALAL and Kosher.
 
   
Leaf Improvements from China Common Leaf Through GLG Propriety Strains
The most important part of the supply chain to control is the leaf.
For both consistency of taste in a stevia extract and cost of stevia extract
Leaf accounts for over 60% of the cost of stevia extract products
Our patented seeds allow
 
ease and lower cost in scaling agriculture vs. seedling approach
consistency in the taste of stevia sweetener
GLG to offer sustainable lower pricing in the industry
Leaf Improvements from China Common Leaf Through GLG Propriety Strains
To produce one metric ton of RA80, the approximate required amounts of different varietal leaves are:
 
Our Competitive Advantage: Leaf Growing Capacity