Over 30 enterprises have set up raw material bases in the Ulanbuh Desert in the Inner Mongolia Autonomous Region.

The Pangu Group planted 60,000 mu (10,000 acres) of environment protection forests in its base, utilizing hidden-pipe technology for saving water.

The Govern Group Inner Mongolia (GGIM) grew Kudou Grass to produce environmentally friendly pesticide and developed a squash series grown in its sand base. Some 273 migrants and 2,000 local farmer families helped the GGIM grow this sand-living vegetation and successfully rid the area of poverty.

The Ningxia Meili Paper Industry Company upgraded the original straw paper production line to wood paper with its 200,000 mu (about 33,000 acres) of fast-growing trees in the Tengger Desert.

The Elion Resources Group built a million-mu of sheltered belt forests and a million-mu of medicinal materials base. The company developed dozens of medicines and plans to sell 10 billion yuan (US$1.2 billion) worth of production, making a profit of 700 million yuan (US$85 million) in the sand industry within five years.

Farmers in Zhangye Prefecture of Gansu Province have built 1,000 hectares (1,500 acres) of vegetable trellises and 60 hectares (15 acres) of energy saving greenhouses. The 800 companies in sand harvest processing, with a yearly production value of 2 billion yuan (US$242 million), made the prefecture a vegetable base providing east China as well as overseas with its produce.

In recent years Horinger County in Inner Mongolia has a series of leading companies specializing in sallow thorn production, liquorice medicine, dairy and ecological tourism. These businesses prompt economic growth and environmental protection. Last year, the county’s fiscal income reached 150 million yuan (US$18 million).

According to the Office of Desert Control under the State Forest Administration, over 2,000 units are exploiting sand resources and the sector has industrialized.

Wang Chengzu, director in charge of the shelter-forests construction in northern, northwestern and northeastern China under the State Forest Administration, said private companies will be the main power source for effective ecological protection and construction as they promote high technology, have large funding, large market networks and promise a higher rate of survival for the forests.

Grass Industry: Gains Not Grains

Under the guidance of the Yili Group, one of the national dairy magnates, farmers in an Inner Mongolian village named Tulihe started to grow forage grass and breed cows. “My income has increased seven to eight times,” says Zhang Sanliang, a villager. He now grows grass in all his 20 mu (3.33 acres) fields.

The Yili Group built a cow breeding base in the village. Another farmer, Ren Peiping says he earns 10,000 yuan (US$1,200) per month by providing the Yili Group with milk. Besides growing grass in all his 30 mu (5 acres) fields, he needs to buy other 20,000 yuan (US$2,420) worth of forage each year. He says that the village’s 2,000 mu (333 acres) fields are now all growing forage grass and many forage companies have sprung up.

According to Zheng Junhuai, board chairman of the Yili Group, the company has helped about 100,000 farmer families shrug off poverty (by the above mentioned operation) through bringing together companies, production bases and farmers. The funds borrowed to help farmers buy cows has totaled 1.2 billion yuan (US$145 million) and the company has set up a completed service system that includes cow breeding, forage provision, cow disease prevention and milk transportation and sale. Last year, farmers earned 1 billion yuan (US$120 million) from the company through milk provision alone. The company’s production was valued at 4 billion yuan (US$480 million) and it paid taxes of 500 million yuan (US$60 million).

In Jiuquan Prefecture, Gansu Province, farmers find that growing purple medic (Medicago Sativa), each mu yields 1 ton of dry grass and 30 to 40 kilograms of grass seed, brings them earnings of at least 600 yuan (US$72.58), several times more than that of growing wheat. The Daye Group in Sichuan Province was also attracted to build a branch of the Yuman Daye Company, owning a 100,000 mu (16,666 acres) raw material base with yearly production of 50,000 tons of purple medic.

There are 12 million mu (2 million acres) of fields growing grass in Gansu Province. Among them, 6 million mu (1 million acres) are covered with purple medic. The grass processing industry at present includes production of grass powder, grass block, grass grain and forage grass. The total processing ability of the province will reach 1.5 million tons by 2005.

The Caoyuan Xingfa Group of Inner Mongolia (CGIM) started business with three houses and 300 chickens. Over a dozen years later, it has developed into China’s largest grassland food production company with assets of 2.55 billion yuan (US$309 million). The company has also developed an innovative operation model that speeds up lamb growth and reduces costs.

The CGIM has now 71 food processing factories in Heilongjiang, Jilin, Gansu, Qinghai and Xinjiang, boasting processing capacity to 6 million sheep and 80 million chickens. It has 4,500 sale points nationwide and sells its produce to Japan, Russia and the Middle East. The company assists more than 100,000 farmers and redundant employees to be more prosperous.

Pan Zhaodong, researcher with the Inner Mongolian Academy of Social Sciences, says the sand and grass industry has improved both the environment and the economy. And in time they will develop into pillar industries for the western economy.

(China.org.cn by Feng Yikun, April 24, 2004)