We are among the top eight producers of premium non-organic raw milk in China with a total production volume of approximately 113,300 tonnes in 2013, according to the F&S Report. As of December 31, 2013, we operated 12 non-organic dairy farms in Hohhot, Inner Mongolia with a total of 29,836 dairy cows. We seek to provide our non-organic cows with a comfortable, low stress environment and with nutritious feed to promote their health and productivity. We feed our dairy cows at these non-organic dairy farms with the same types of forages and concentrated feed as our organic dairy cows purchased from third-party suppliers, but we do not require them to be organically grown or processed. During the Track Record Period, substantially all of our premium non-organic raw milk was sold to Mengniu Group and Yili Group for their further processing into high-end dairy products.

We are committed to the welfare of dairy cows at our non-organic dairy farms. Our non-organic dairy farms are free stall farms with an average space per cow of approximately 30 square meters. A majority of our non-organic dairy farms have a capacity to house between 2,500 and 4,500 dairy cows. We believe that the size of our farms enables us to achieve greater economies of scale and optimal cost-benefit ratio. Same as our organic dairy farms, our non-organic dairy farms have easy access to food and water, clean, comfortable, dry sand bedding and sport fields that allow our dairy cows to eat, drink and relax freely. We generally follow the same milking process as our organic dairy farms with substantially the same types of equipment as used on our organic dairy farms. See “— Organic Dairy Farming — Milking process” for details.

We feed our non-organic dairy cows with the same types of feed as our organic cows, including corn silage, guinea grass, alfalfa and concentrated feed purchased from third-party suppliers; however, we do not require them to be organic. To ensure sufficient protein intake, we primarily feed our dairy cows with alfalfa imported from the United States. In addition, we sourced corn silage and guinea grass, as well as concentrated feed, locally, during the Track Record Period, and require our suppliers to meet our internal quality standards. We use different feed formulae developed in-house employing the total mixed ration, or TMR, concept based on the cow’s development stage, lactation stage and milk yield. We have also installed feed-mixing equipment on the feeding trucks at our non-organic dairy farms to mix forages and concentrated feed based on such formulae to reduce cost and better control feed quality. In addition, unlike our organic dairy cows which drink purified water, our non-organic dairy cows drink groundwater from wells on our farms. We inspect the water quality regularly to ensure that it is clean and safe.