On June 17, 2022, during the anniversary 25th St. Petersburg International Economic Forum (SPIEF), at the Russian Export Center venue a package Agreement on strategic cooperation and expansion of mutual trade between the Russian Group of Companies "New Land Grain Corridor” and the Chinese state corporation "Zhongchengtong International Investment" (a part of "China Chengtong") was signed in the presence of the General Director of the Russian Export Center Veronika Nikishina, . The document was signed by Sergey Pushkin and Zhou Liqun. The production and export company "Food Export Trade", a member of The "New Land Grain Corridor" Group of companies, the key operator of this package Agreement, the "contract farming" organizer, investor, elevator infrastructure operator and the holder of the export contract.
In accordance with the document, the Russian and Chinese parties agreed to develop infrastructure and increase the production of grains, legumes and oilseeds in the territories from the South Urals to the Far East, and the supply of grain in the amount of 1.9 trillion rubles with settlements in national currencies. In addition, the parties plan to organize deliveries with subsequent localization of technological equipment and agricultural machinery production in the Russian Federation in the amount of 150 billion rubles, as well as joint investments in the amount of 50 billion rubles.
“We have been working on developement of the infrastructure and mechanisms for realizing the great agricultural potential of the Urals, Siberia and the Far East for many years. With science-based, careful approach to production, you can first triple - up to 65 million tons per year, and then increase the production potential to 80 million tons per year, through the development of "contract production", using modern agricultural technologies, fertilizers and processing additional lands. It is confirmed by the results of the largest sectoral scientific study we organized since the USSR existance, which is being analized by eight specialized SRI. The realization of the production potential of these regions will not only strengthen the country's food security and its economy, but will also help to double Russia's total exports, make Russia an important food supplier to China, the countries of Central Asia, and, in the future, to the countries of Greater Eurasia. It is particularly important in view of global climate change and the deterioration of the world food situation,” said Sergey Pushkin, CEO of the of the "New Land Grain Corridor" Group parent company .
An increase in grain production associated with the development of "contract production" is a well-established mechanism for production stimulating including the option of an advance payment at the amount equal up to 50% of the annual planned supply volume and formula pricing. The elevator infrastructure also need active development, today “Food Export Trade” is designing two of the seven linear elevators (each for 200 thousand storage tons of ). " Grain Terminal Zabaikalsk", the world's first specialized land grain terminal with a capacity of 8 million tons per year and actually the largest grain logistics facility of the country, is intended to become an important element of the grain logistics infrastructure.
The Group's investments in the terminal will amount to 9.5 billion rubles (as of today it is equal > 8 billion rubles). The facility is unique both in terms of technology and the level of biological safety, as well as in terms of complete traceability, non mixing of batches and other important technological aspects. The terminal is scheduled to be put into operation in September 2022 in the context of the Eastern Economic Forum.
For reference:
The "New Land Grain Corridor" Group of companies is a production holding structure that implements a program for the development of grain production and grain logistics infrastructure in the Urals, Siberia and the Far East. The New Land Grain Corridor program is supported by the President of the Russian Federation, the Chairman and the Government of the Russian Federation, Intergovernmental commissions and the Eurasian Economic Commission.
The New Land Grain Corridor Group of Companies includes the unifying parent company of the New Land Grain Corridor group, “Food Export Trade”, which owns formula pricing technology, advanced scientific research in the crop production field, is the holder of export contracts and an operator developing elevator infrastructure, and Zabaikalsk Grain Terminal LLC, a specialized full-cycle land grain terminal that solves the problem of wheel tracking difference and provides high productivity up to 8 million tons per year with the highest level of biological safety that meets all the requirements of the Russian Federation and China.
"China Chengtong" company is managed by the State Assets Control and Management Commission under the State Council of the People's Republic of China, and is designated as a state asset management company. It is a major shareholder of several central state-owned enterprises such as National Petroleum and Natural Gas Pipe Network Group Co., Ltd. (PipeChina) and China Green Development Group Co., Ltd. (CGDG).
China Chengtong was working with the assets of Sinopec International Petroleum Exploration and Production Corporation and also coordinated the China Railway Materials Group Corporation. Owns shares of CMST Development Co., Ltd., China Chengtong Development Co., Ltd., Guangdong Guanhao High-Tech Co., Ltd., Yueyang Forest & Paper Co., Ltd., MCC Meili Cloud Computing Industry Investment CO., Ltd. and CTS International Logistics Corporation Limited, and also owns shares in companies listed within the state territory and abroad, including China COSCO, China Shipping Network Technology Co., Ltd., CRSC, CICC, Dongxing Securities, and others. The fields of activity are investments, equity transactions and assets management, as well as technologies, multimodal logistics, exports and imports.
Production-Export Company Food Export Trade LLC
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