Emerald Dairy Building Milk Powder Facility In Northeast China

Emerald Dairy Inc. has announced that it has begun construction of a new milk powder processing facility in Hailun, Heilongjiang.

Hailun City is located approximately 120 miles north of the company's headquarters in Harbin, the capital of Heilongjiang, and 80 miles south of the Company's existing facility in Beian.

Upon completion in early 2009, the new facility will have an annual production capacity of 9,000 tons of milk powder, bringing the Company's total annual production capacity to approximately 18,000 tons by the end of 2009. The company has secured milk supply from local farmers for the facility. In addition, the new facility will provide Emerald Dairy with the flexibility to accommodate future production of an additional 9,000 tons as market demand grows. The project will require an investment of approximately USD20 million, which the Company intends to finance through internal cash flow as well as potential debt or equity offerings.

Yang Yong Shan, CEO of Emerald Dairy, stated that the announcement demonstrated their long term commitment to grow the company by expanding capacity. He added that they believed that the proximity to the capital city, would further strengthen their efforts to expand the company's geographical base.

Through its wholly-owned operating subsidiaries, Emerald Dairy Inc. is a producer and distributor of infant and children's formula, milk powder, and soybean products in China. The Company's products are sold under two brand names — Xing An Ling and Yi Bai.

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