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Alfalfa being cut in the fields at the Escalante Ranch in Utah. The Chinese businessman Zhang Renwu paid "something over $10 million" for the 8,900-hectare ranch and is growing alfalfa for export to China. Photos Provided to China Daily
Above: Ranch manager Frank Biggs (left), and Roger Qiao, an employee of Lu Tian Yuan in Beijing, check the farm machinery. Below: Simon Shao, the executive hiread by Zhang Renwu to oversee the recently purchased ranch, poses for a photo on a visit during the alfalfa harvest.
Healthier cattle feed from down on the ranch, Zhang Yuwei reports.
Around noon on a sunny, early June day in northern Utah, Frank Biggs is on his tractor, busily cutting the season's alfalfa harvest on the Escalante Ranch for a second time. The plant, a member of the pea family and grown as a forage crop in many countries, will be turned into hay and exported as animal feed.
A middle-aged Chinese man waves to Biggs from across the field, carrying a bowl of soup noodles in one hand.
He is Zhang Renwu, 46, founder of Lu Tian Yuan (Green Pasture) Ecological Farm Co in Beijing and the new owner of Escalante, which means "ladder" or "staircase" in Spanish.
"My new boss really appreciates my work, and he even delivers the lunch he made to my tractor. That never happened before," said Biggs, a 37-year-old native of the tiny town of Jensen (population 400), where the ranch is located, who has worked at Escalante for eight years.
The 8,900-hectare ranch, which was put on the market for $16 million last year, was previously owned by a billionaire in Tennessee who used it as a vacation resort and visited just once or twice a year for hunting.
Zhang, who has been in the alfalfa hay import-export business for about two decades, had been searching for just such a deal. In December, two months after visiting the ranch, he signed a deal to buy it. Zhang wouldn't disclose how much he paid, but he said it was "something over $10 million" and "reasonable".
"I'll use the ranch differently from the previous owner, for growing alfalfa. The 1,416 hectares of irrigated land and the surroundings are great for that," he said.
The purchase, Biggs recounted, "caught a few people off guard" when they heard the buyer was a Chinese businessman - a first for Jensen, as far as anyone could tell.
"Now you find Chinese people buying all sorts of businesses, such as vineyards and hotels, in the United States and other countries, but I want to do something different and also something for a better cause," said Zhang.
"It is important to provide high-quality alfalfa hay for cows in China to maintain the high quality of dairy produce. It's a big mission and one I want to continue," he explained.
After the purchase, Zhang kept Biggs on as ranch manager. He also kept on two of the ranch hands.
"They know their business very well, and they are very hard-working people," he said.
"My new boss actually cares about the employees. He is different from my old boss. As long as he treats me fairly, I will continue to work for him, just like any other job," said Biggs.
Export licenses rise
The ranch is adjacent to the Dinosaur National Monument, which straddles the Utah-Colorado border and is named for the giant reptiles that once roamed what are now desert canyons. Hard by the Green River - Zhang indicated that as the owner he has water rights - the ranch hosts some of the richest soil for growing alfalfa and grain.
In the United States, the world's biggest producer, more than 99 percent of all alfalfa hay bound for export is grown in seven Western states, including Utah, according to the National Alfalfa and Forage Alliance.
The number of exporters licensed by the US Department of Agriculture to ship to China has increased to more than 70 from 17 in recent years, according to Simon Shao, the executive Zhang hired to oversee the ranch. Both Zhang and Shao visit Escalante about once a month, sometimes more frequently during the harvest season, which runs from March to October.
Zhang, a native of the Inner Mongolia autonomous region, has been working in agriculture since he graduated from Shandong University with a degree in biology in the late 1980s. He has been involved in exporting alfalfa hay since 2007, buying the crop from licensed US processors and shipping it to China.
Last year Zhang shipped about 50,000 tons to China in the form of double-compressed bales, compared with 5,000 when he started his business five years ago.
"It's hard to believe that it actually may cost less to ship from Long Beach, California, to cities in China than to ship between cities in China," he said.
Zhang's company, Lu Tian Yuan, is based in Beijing's Changping district. It employs roughly 300 people in three factories in the capital and in Inner Mongolia and is one of the oldest and biggest suppliers of alfalfa pellets in China. Its clients include well-known Chinese dairy brands, according to Zhang, although he declined to name them, and customers in Japan and South Korea.
Despite the increasing need for alfalfa hay to feed dairy cows, the rapidly decreasing quantity of arable land in China has affected production of the crop domestically, said Zhang.
"It's true that not all dairy producers can afford high-quality alfalfa, but paying a bit more can increase the output and quality of dairy products, which will eventually create sales value for the producers," Shao said.
Increasing the proportion of alfalfa to about half of a cow's diet is a good way to boost protein levels in milk to the international standard of 3.2 percent (compared with China's current 2.8 percent) or higher, said Lu Xinshi, a professor at Beijing Forestry University. "Alfalfa in the diet can also help extend a cow's milking life and increase the quality of the dairies," Lu said.
As owner of the Utah ranch, Zhang is legally an alfalfa hay provider and can conduct business with processors in the US directly, making his business sustainable, as he put it.
"We have seen the price increase from about $200 a ton two years ago to more than $400 a ton last year," said Shao. "It looks good and may still be on the rise."
To supply its growing dairy industry, China bought 96,000 tons of alfalfa hay from the US in the first quarter of this year, more than half the total in 2011 and 200 percent higher than in the first three months of last year, according to the Livestock Marketing Information Center in Denver.
"China's buying patterns will likely be highly dependent on their domestic forage production. The faster forage production meets demand in China, the less China will need to source forage from the US and other countries," said Katelyn McCullock, a dairy and forage economist with the center, which connects USDA economists, industry representatives and university agricultural extension agents.
The top export destinations for US alfalfa include Japan, the biggest buyer, and South Korea. Meanwhile, China and the United Arab Emirates have become fast-growing markets for the crop in recent years, according to the USDA.
"The last three years have seen explosive growth in alfalfa hay going to China," McCullock said. "It is doubtful that the Chinese will continue to buy at such a high growth rate long-term. However, it remains difficult to predict the domestic forage-supply situation in China or when exports will slow down."
Zhang, who had just returned to Beijing after visiting Utah, said he aims to obtain 40,000 to 50,000 tons of alfalfa this year, partly through crop purchases from nearby farms. That, he predicted, could translate into "more than $1 million" in income.
Escalante's location in a basin between mountain ranges makes it ideal as a grazing spot for several species of wild game. In late summer and early fall, deer and elk migrate to the ranch seeking abundant food and space. That's when the hunting season starts, said Zhang, who plans to develop a hunting business when the alfalfa harvest ends this fall.
"The lodge on the ranch is well-equipped and can accommodate about a dozen people at a time," he said.
Meanwhile, his hunt for additional farmland will continue. "I am looking at more farms now, in Utah and other states and am considering buying more."
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(China Daily 07/16/2012 page1)