1．Introduction to the Project

1.1Project Background

1.1.1 Necessity of Project Construction

China is the most populous nation to use chopsticks in the world. Chinese chopsticks are the most important and unique dining utensils. Though chopsticks are small, they are related to the colossal task. The market is using wooden chopsticks on a large consumption of timber resources, particularly in the fast food industry. The widespread use of disposable chopsticks on the destruction of forest resources is particularly acute. According to national authorities' statistics, China's disposable chopsticks annual production and consumption is about 45 billion pairs, consuming 1.66 million cubic meters of wood, taking away about 25 million trees. In order to change this phenomenon and protect our forest resources, in recent years, the relevant state ministries, commissions, bureaus and provincial governments are formulating corresponding policies and measures ,aiming at changing and solving this problem. At the same time, people are researching and developing disposable chopsticks for a new generation of alternative products throughout the country.

In order to be in comprehensive utilization of agricultural by-products and comply with the national industrial policy of reducing cultivated land and restoring the forest, protecting ecological balance and eliminating white pollution of industrial policy, Gongzhuling National Agricultural Science and Technology Park will take straw, corn straw, corn on the cob, husk, reed, cotton shells and other agricultural by-products as raw materials. They put them into composite molding by high temperature, high pressure after mixing starch, food grade adhesives, waterproof material (such as egg white) and other materials with stir. The core technology is the successful use of safe, non-toxic, harmless and edible adhesive, which is made from natural honeycomb rubber and natural plant ,implementing the technology of bonding without any chemicals creatively first in China. Chopsticks produced by this technology are smooth, feel comfortable. They have high strength in toughness, oil, water, heat and acid. They are non-toxic, harmless and pollution-free and can be naturally degraded.

All data indicate that this technology is mature, advanced, reliable and products are in good quality with industrial production conditions. Based on the analysis of current domestic demand for chopsticks plant fiber and the actual situation of enterprises, Gongzhuling National Agricultural Science and Technology Park intends turn it's technology into industrial production. The production scale of biodegradable plant fiber chopsticks is defined as 4 billion pairs annually.

1.1.2Analysis of Conditions of Project Construction

Gongzhuling City is located in the Plain of Songliao, in western Jilin Province, east longitude 120 ° 11 '~ 125 ° 18', latitude 43 ° 11 '~ 44 ° 09'. The total area is 4058 square km, govern over 29 towns, 414 villages, 3213 village groups, 16 million farmers. The total population is 1039 thousand, of which agricultural population is 673 thousand, accounting for 65.3%. Rural labor force is 168 thousand people, 3.3 million acreage of cultivated land.

Gross domestic product in 2005 reached 8.367 billion yuan, of which the first industrial added value was 40.77 billion yuan, secondary industry 1.74 billion yuan, the tertiary industry 2.551 billion yuan. GDP per capita reached 8,048 yuan.

Over the past 50 years since New China was founded, Gongzhuling City has formed 35 categories, 135 series, 211 main species, over 1300 standard models of the industrial system as metallurgy, chemical industry, coal, light textile, clothing etc., which take auto parts and machinery industry as the main, medicine, building materials, fodder as the key. The city has 340 industrial enterprises, nearly 300 species selling products, 25 kinds of products to enter the international market. Auto parts products have become a supporting base for the FAW.

Gongzhuling City is rich in resources, with strong development potential, and stability of grain annually produce more than 41 billion kilograms a year. In addition to the completion of each task and the farmers own country, there are a large number of surplus grain (corn) for a variety of deep processings. There are factories as in joint venture deal with 400,000 tons of maize, "Yellow Dragon" deep processing of corn and corn sweetener, in Jilin Province and the whole country occupied a certain place. Gongzhuling's oil and gas reserves is up to 10 billion cubic meters, which has been introduced to the urban area.

Gongzhuling City has a convenient transportation, 50 kilometers south of Changchun, 25 km south of Gongzhu Ridge. Rail, road weave into networks; 102 National Road, Beijing-Harbin railway run through the whole area,52 km and 240 km away from Changchun Airport and Shenyang Airport respectively. The city has put 60,000 program-controlled telephones into use , as well as DKD and BP machine network communication, laying the foundation of the development of the city.

Gongzhuling City is high in south and low in north. the highest peak is in Jiguan Mountain in Longshan Town, 374.9 meters above sea level; The lowest station is in Liaohekou in Sangshutai Town, 130 meters above sea level. The watershed of Songliao Plain starts all the way from Taojia Town, Heilinzi Town, Huaide Town to Lianhua Town, Shuangchengbao Town; It belongs to the Songhua River, the two major river systems in the watershed area of Liaohe the slope water zone. Surface water is the East Liaohe, Songhua River.

According to the existing plant engineering geological exploration report, the bearing layer of this region is supposed to be below the third Silty clay layer, holding the force between 210 and 400 kPa. Groundwater does not corrode steel in concrete structures and reinforced concrete structures, weak corrosive to the steel structures. The permafrost site is deep 1.70 m.

1.2 Construction Contents and Product Scale of the Project

1.2.1Scale of the Construction

According to market analysis and forecast, as well as the actual construction conditions of the project, we determined the construction scale of the projects is: an annual output of 4 billion pairs of fiber biodegradable chopsticks.

1.2.2 Product blue print

Product has only one specification, that is 18cm long common type of chopsticks.

  

Table 1 Comparison of Product Ingredients  

The characteristics of the project formulation is that it overcomes the problem of chemical substances and wall coating materials such as pre-release of harmful substances of other productions, and these are usually used in composite resin or glue are inseparable from xylene, toluene, acetaldehyde, acetone and other harmful chemical ingredients. This project uses the new material. It does not contain toxic substances because the full use of composite edible glue. And in the mixing process, the small amount of residual pesticide on surface is wrapped, therefore it's safe, reliable, non-toxic, harmless, oil proof and waterproof, which can be proved from the various test results of degradable products, especially from the "toxicological toxicity" test results.

Product has only one specification, that is 18cm long common type of chopsticks.

1.2.3 Technical program, equipment Program and engineering program

（1）Technical program(Processing of agricultural products)

Basic technical requirements

The raw materials used in the production of the project is non-toxic, harmless, clean, pollution-free. The chaff, straw, husk, sawdust, bamboo powder, corn on the cob and straw and other plant fiber powder comply with national regulations and standards of food hygiene and environmental protection.

Plant fiber powder particles ≤ 0.5mm

The following states of raw materials cannot be used: metamorphic, moldy or contaminated; Content of harmful substances that do not meet national food hygiene standards.

②Hygiene requirements

Table 2 Sanitary Requirement of Materials of Powdered Vegetable Fibre Sanitary Requirement

③Product features and quality standards

The plant fiber chopsticks produced in this project meet the quality requirements of disposable tableware in hardness, strength, bending, tension, specific gravity, water resistance, oil resistance, acid resistance, alkali resistance, leakage, heat resistance, cryogenic, food toxicity. The process of using is safe and nontoxic. They'll rapidly degradate in nature after using and they have the feature of convenience, health and environmental protection.

All the indicators of the product execute according to national standard of 《General Technical Requirements of Disposable Degradable Tableware》(GB18006.1-1999), the table below.

 

 

 

Table 3 Product Quality Standard

（2）A brief description of the production process

①Raw material

The project intends to establish a number of raw material crushing stations in all bases of raw materials collection. The acquisition of raw materials(mainly maize straw, rice straw) would firstly get rid of sand, soil, and then crush the purpose of flour 60(Impurities crushed in raw sand is less than 0.6%).All the raw materials into the factories are plant fiber powder primarily processed in each purchasing base of raw materials.

Mixing ratio and compound of raw materials

A. The ratio of raw materials is essential for: fiber powder 60～65%, other filler such as starch 20%, Edible glue and waterproof materials 15～20%.

B. Put the ratio raw materials above in a sealed high-speed mixer barrel, and then heat to 90 ~ 110 ℃.Stir in the high speed of 3200 ~ 3500 rpm per minute on the purpose of achieving the role of packaging in the first step. That is achieving starch, edible glue, and other fillers on the role of plant fiber powder parcels, effectively wrap up all the micro-fiber plant residues and micro-dust, getting prepared for molding products.

The important note here is that the traditional plant fiber products basically remove soil residues and dust by soaking(or called cleaning method) or chemical separation, which methods are likely to cause emission pollutions or other secondary pollutions. However, the production of this project is using scientific methods to solve this problem by wrapping. During the first two processes, only mix in 7 ~ 8% of the water solvent when high-speed mixing, as well as the humidity of raw materials the sequence of production processes meet the standards on the use, can it achieve evenly wrapping of high temperature and high-speed mixing.

③High temperature, high pressure forming

Pour the evenly wrap composite material, according to the amount of raw materials required mold into the mold filling quantitatively, start squeezing the molds whose upper and lower heat to 135 ~ 150 ℃ (pressure 180kg/cm2), 15 seconds after the exhaust once, a total of row 2 to 3 times, 1 minute molding the mold. The purpose of exhaust is to increase the surface finish of the product, to enhance the density and evaporation of volatile compounds with high temperature and pressure.

④Cooling the molding products

After removing the molded hot product, put them on the working platform or a transmission belt under natural conditions, letting naturally cool. It ends when it becomes harder.

⑤Milling(Squaring)

Put the products stereotyped into the grinding machine, then send the polished products to the inspection workshop.

⑥Testing package

Put the qualified products on the conveyor belt in the inspection workshop. Package them after irradiated by germicidal lamps.

⑦Send the packaged products into the Store House.。

（3）Engineering solutions

①Architectural features, structure and size of the program of buildings and structures(adding plans)

Characteristics, structures and sizes of main buildings(structures)

A Buildings

a Integrated office builing: 50×15×5＝3750m2, five-storey, story 3.3m, brick-concrete structure, pile foundation.

b Workshop: 91×51＝4641m2, 3 builings in total, total construction area13923m2, single-storey, story 6.6m, bent structure.

c Raw material warehouse: 153×15＝2295m2, single-storey, story 6.6m, bent structure.

d Ingredients warehouse: 90×30＝2700m2, single-storey, story 5.4m, light steel structure, color plate envelope.

e Finished goods warehouse:102×30＝3060m2，single-storey, story 5.4m, light steel structure, color plate envelope.

B Structures

a Equipment foundation: plain concrete structure, sand cushion

b Firefighting pool: reinforced concrete foundation, underground construction

c Pipe Rack: reinforced concrete structure

d Trench: brick walls, plain concrete floor

General layout

Intended to plant a total area of 5 hectares election

②Amount of construction and installation works and estimated amount of three materials.

Installation cost, according to equipment type and price or in accordance with the relevant provisions of the local.

Table 4 List of Main Buildings and Structures

1.3 Forecast of Economic and Social Benefits

1.3.1Economic Benefits

（1）Revenue estimates

Referenced to current market selling price of similar products, it is determined that the selling price of this product is 0.04 yuan / pair. The annual sales income of the project is: 4 billion pairs / year × 0.04 yuan / pair = 160 million yuan / year.

（2）Costs estimates

①Raw material costs

A、Base material: 31,200 tons / year × 200 yuan / ton = 6.24 million yuan

B、Sticky material: 16,800 tons / year × 4600 yuan / ton = 77.28 million yuan

C、Packaging: Including a variety of bags, boxes, etc.,annual cost is about 20 million yuan

Total raw material cost is 103.52 million yuan in total.

②Fuel and power consumption

Total annual fuel and power consumption is 1.2859 million yuan, as follows:

Water: 1.65 yuan / ton × 12000 ton = 19,800 yuan

Electricity: 0.66 yuan / kWh × 1.3 million kWh = 858,000 yuan

Heat: 22.5 yuan / m2 × 18273 m2 = 411,100 yuan

③Wages and welfare costs

The fixed number of labor is 450 and the average wage is 800 yuan / person, monthly, at the same time taking into account 14% welfare costs. The annual salary and welfare is 4,9248 million yuan.

④Repairs

Take into account 1.5% of construction costs, equipment and industrial equipment acquisition costs and installation costs. The extracted amount is 1.9834 million yuan each year.

⑤Depreciation

Project depreciation is calculated in accordance with the average year and residual value is calculated according to 4%. Buildings depreciation period is 25 years. Machinery and equipment depreciation period is 10 years. See detailed table of fixed assets depreciation estimated table.

⑥Amortization charges

Intangible assets are amortized as 10 years. Deferred assets are amortized as 5 years. See intangilbe and deferred assets estimated table.

⑦Finance costs

According to relevant provisions of the project Financial Evaluation promulgated by National Development and Reform Commission. The interest brought about by long-term loan in project (ie, financial costs) is included in the total project cost. finance costs gradually decrease as the project principal interest and loan balance each year to reduce.

⑧Other costs

Other costs are the costs of manufacturing, marketing and management after deducing wages, welfare and expreciation, amortization charges and repair costs. In order to simplify the calculation, the costs are based on 5% of sales income, about 3 million yuan per year.

It is calculated that the annual cost of the project is 133.0356 million yuan.

（3）Analysis of profit and revenue

①Sales taxes and surcharges

According to calculation, the sales tax and surcharges of the project is 12.3096 million yuan.

②Income Tax

The rate of income tax of the project is 33%. The tax is based on taxable income implemented by the project each year.

（4）Payback period

7.09 years

（5）ROI

12.51%

1.3.2 Social Benefits

In response to these problems, in recent years the relevant state ministries, commissions, councils and the provinces in the city government are formulating appropriate policies and measures aiming to change and solve this problem, at the same time ,throughout the country there is research and development of a new generation of disposable chopsticks alternative products. The production technology of the project comes from the Technology Development Co., Ltd. Bazhou Heiner. The chopsticks materials mainly adopt plant straw and rice straw, which are used to replace the finished wood and bamboo consumed in food and beverage industry. The chopsticks produced can replace the wooden(Bamboo) Disposable chopsticks used on the market. It has many advantages:

（1）Analysis of technique

First of all, it is technically reasonable to produce biodegradable chopsticks by using plant straw and rice straw as raw materials. It replaces the traditional paper pulp tableware production where the process is complicated, difficult with high costs and slow speed of degradation products. It combines the high technology and environmental together. The production process is the assembly line, therefore the production efficiency is high. Second, the sources of raw materials and auxiliary materials are adequate, which can completely meet the production requirements. Next, the biodegradable chopsticks with environment-friendly plant fibers are line with national standards<< General Technical Requirements Of Disposable Tableware >>(GB18006.1-1999) for their hardness, strength, waterproof, acid-proof, alkaline proof, food toxicity and other indicators.

（2）Analysis of the environment

Seen from the process, the production of environment-friendly plant fiber biodegradable chopsticks is without chemical reaction. It only crushes the raw materials and mix with auxiliary raw materials (Auxiliary materials adopts non-toxic, tasteless raw materials that do no harm to human body). After stirred they are sent to the program-controlled machine for thermoforming. Then they are in the package storage with UV disinfection. Compared with this, chopsticks with pulp molding method are totally different. First the pulp is made of wood or plant straw. Then it is molded into products. In the pulp manufacturing process a large number of black liquor is produced. The pollution is serious and difficult to control.

The chopsticks produced in this project can be used as feed after they are used for the first time. If access to the natural environment, by a month or so they could be microbial degraded into organic fertilizer, which will not do potential harm to the environment. It is much better than plastic chopsticks because when the plastic chopsticks are used, they need about 100 years to be degraded in the natural environment, which causes serious environmental pollution.

（3）Analysis of energy saving

Calculating from the national market under the current consumption of 45 billion pairs of chopsticks, the annual cost of wood is about 1.66 million, consuming about 25 million trees. Under this project ,the production is four billion pairs / year, the annual savings of wood is about 150,000 cubic meters ,which is equal to 2.22 million trees cutting down per year. At the same time, the project consumes plant straws remained in rural areas and increases the income of peasants, which is the best of both worlds. The use of plant straws saves a large number of timber, bamboo, which has far-reaching significance to the improvement of the forest reserves, the maintenance of ecological balance and the protection of the environment.

1.4 Total investment and fund-raising program

1.4.1 Estimated Investment

（1）Project Investment

The total investment is 166.6668 million yuan. Among this Construction investment is 161,644,000 yuan. The interest of construction period is 3.168 million yuan.

The project construction investment (not including construction period interest) is 161.644 million yuan. The specific form is as follows:

Construction costs:      2768.52 myriad yuan

Purchase of equipment and Instruments： 9668.20 myriad yuan

Installation cost:          785.92 myriad yuan

Other construction costs：    1744.40 myriad yuan

Basic reserve fund:     1197.36 myriad yuan

（2）Estimated liquidity investment

According to actual operation of the project, the project accounts receivable, raw materials, fuel and power, cash, the minimum turnover days and the minimum flow of accounts payable are determined. By calculation, the project capital is 6,182,700 yuan.

1.4.2 Funds Raising

（1）Self-financing

 111.644 million yuan is raised by the enterprise of the project.

（2）Other sources

The project intends to apply for bank loans at 50 million yuan with 5.76% interest rate. The loan interest of construction period is 3.168 million yuan.

1.5 Project Cooperative Way 

Joint venture

1.6 What to be Invested by Foreign Party:

Funds.

1.7 Construction Site of the Project

Gongzhuling National Agricultural Science and Technology Park.

1.8 The On-going Condition of Project

Has been finished, looking for a partner.

2 Survey of Project Undertaker

2.1 Basic Conditions

Unit: Jilin Agricultural Hi-tech Industry Co., Ltd.

Legal address: No. 2264, Princess West Avenue, Gong Zhuling City, Jilin Province

Legal Representative: Zhang Lizhi

Enterprise Ownership: Limited Liability Company

2.2 Company profile

The company has fixed assets and cash as the registered capital. The total capital is 600 million yuan. It owns 22 employees with annual profit of 500,000 yuan.

2.3 Contact Methods

Contact person：Guo Fengzhi  0434-5061019