Grain processing to spur Changchun economy

Secretary of the Jilin Provincial Committee of the Communist Party of China Wang Min (front, left) on an inspection tour of the Changchun Economic and Technological Development Zone

"The growth of Changchun, capital of Northeast China's Jilin Province, is determined by the city's economic and technological development zone, while the future of the development zone in turn depends on Xinglong Mountain," said Huang Wenhua, chief of the Changchun Economic and Technological Development Zone, while talking about the development of the city's economy.

What makes the little-known mountain to the northeast of the development zone the key to Changchun's growth?

The answer lies in the corn industrial park under construction in the mountain.

Work on the park, which is a key project in the city's development plan for the 11th Five-Year Plan (2006-10), began last October.

Construction of infrastructure in the park is advancing smoothly, aided by a 730-million-yuan investment from the city government.

A 40-kilometer road network is scheduled for completion this year, while 2.7 kilometers of a renovation project for a 4-kilometer highway have already been covered.

Progress is simultaneously being made on the setting up of communication, water supply and drainage systems.

While a main line for power supply is available for use, heating and sewage treatment facilities will be put in place by next year.

Amid the buzz of such infrastructure construction, investment promotional work is moving into top gear.

The corn industrial park authorities have visited more than 100 leading companies to brief them on the investment environment of the park.

Seven companies have so far signed investment contracts, which include a 1-billion-yuan project with an annual output of 1 million tons of corn starch sugar and a 100-million-yuan project with an annual output of 300 million disposable dining containers made of corn starch.

The Dacheng Group, a local corn processing company, will begin construction of its 1-million-ton corn ethanol project in July.

The investment projects already under construction or about to begin construction in the corn industrial park are projected to realize an output value of 28 billion yuan in 2010.

The park authorities will intensify efforts to seek more investment and extend the corn processing industrial chain, Huang said.

They plan to attract four or five big projects this year, each with an investment value of more than 50 million yuan.

Distinct edge

As a main corn production base in China, Jilin Province has a distinct advantage in developing its grain processing industry.

The province produced 19 million tons of corn last year, the rich output ensuring ample raw material supply for the grain processing industry.

Meanwhile, as a key petrochemical base, Jilin has a well-trained workforce for the chemical industry, which provides a strong technological support for producing corn ethanol.

The Dacheng Group has developed a proprietary technology in producing corn ethanol and is now one of the world leaders in terms of corn processing capacity and lysine output.

Corn ethanol has a lower production cost and involves less material consumption than petroleum and thus enjoys a clear comparative advantage, experts say.

In addition to promoting the corn industry, corn processing also helps spur growth of the textiles, plastics manufacturing, automobiles and food sectors, Huang noted.

"We will build up the biggest, modern, biological, chemical and light textile base in Xinglong Mountain," he said.

Huang also said that the Changchun corn industrial park will cooperate with developed regions in the south of China in seeking to build a cross-regional industrial park.

Setting standards

As a growing number of grain processing investment projects begin construction in provinces such as Jilin, Liaoning, Heilongjiang and Shandong, a trend of elbowing for resources and market is foreseen.

The fierce competition has led to a sharp increase in the price of corn.

The National Development and Reform Commission recently released an urgent document aimed at tightening control over bio-fuel ethanol project construction and checking the rush for development of corn ethanol investment projects.

The latest official document, which requires a shutdown of inefficient grain processing companies, is good news for the Changchun corn industrial park, Huang said.

The Dacheng Group leads the world in the technologies for making ethanol and lysine, and is thus included in the list of State-supported projects, he added.

The Changchun corn industrial park is playing an important role in helping set industrial standards and regulate the market for China's grain processing industry, Huang stated.

(China Daily 03/08/2007 page20)