Heilongjiang Feng Agricultural, the Australian subsidiary of China’s largest argribusiness Beidahuang Group, has planted its smallest recorded crop in Western Australia at just about 6,000ha.
The crop, less than a tenth of the 65,000ha Heilongjiang planted during its first year of operation in 2013, was believed to consist mostly of canola, World Grain reported on 10 August.
Most of Heilongjiang’s 85,000ha of purchased farmland was now rumoured to have been leased out, with approximately 10,00ha of land remaining near the firm’s Connemara property near Lake King.
A former employee at the Lake King farm told the Countryman that funding issues with chemicals, fuel and feed, in addition to internal politics, made operating the farms difficult after the first two successful years.
“In 2015 around 22,000ha was sown and lots of sheep were being sold,” the anonymous source said. “Last year it was about 20,000ha, and this year I would estimate it being only about 6,000ha in Connemara.”
The company reportedly invested US$200M in Australian farmland when it entered the market, intending to bypass Western Australian grain growers’ cooperative CBH Group’s handling facilities to export grains directly to China.
Out of the total investment, Heilongjiang planned to put US$10M into an upgrade of the Albany storage and shiploading facilities leased from Vicstock Grain and US$3M into road trains, with other investment targets including precision seeders, chaser bins and on-farm storage.
In addition to the farmland, Heilongjiang also maintained a sheep stock of 10,000 animals.