新希望:2024年年度报告(英文版)

New Hope Liuhe Co., Ltd.
2024Annual Report
2025-35
[April 26, 2025]

2024Annual Report
Section 1 Important Note, Table of Contents and Definitions
The board of directors, board of supervisors, directors, supervisors and
senior executives of the Company warrant that the contents hereof are true,
accurate and complete, and free of any false recordings, misleading statements or
significant omissions, and that they will be jointly and severally liable forthe legal
consequences.
As declared by Liu Chang (chairman of the Company), Chen Xingyao (chief
accountant) and Su Xiaodan (the person in charge of accounting organization &
accountant in charge): the financial report herein is true, accurate and complete.
All directors of the Company attended the board meeting deliberating this report.
I. Animal disease and natural disaster risks
Animaldiseaseisthemainriskfacedinthedevelopmentoflivestockindustry.
There are two kinds of risks arising out of the occurrence of epidemic disease.
First, the occurrence of epidemic disease is likely to result in death of livestock,
directly resulting in reduced yield, increased costs and lower prices. Second, the
occurrence and prevalence of animal disease on a large scale easily influence the
consumer psychology, leading to a contraction in market demand, and also
affecting the feed production and operation. For example, the first outbreak of
theswinefeverinChinainmiddle2018causedahugeshocktothewholeindustry.Theswinefeverexperiencedaweakenedmutationattheturnofwinterandspring
between the end of 2020 and beginning of 2021, making it more spread channels,
longerincubation time, and more difficult to detectand eliminate.In recent years,
major swine diseases have gradually become normal. Especially in the winter and
early spring when the temperature is low, they have caused particularly severe
impacts in the northern regions of China.
Intermsofthenaturaldisasterrisk,thefeedandslaughterarecloselyrelated
to planting and livestock breeding industry. Therefore, the natural disasters such
astemperatureanomalies,drought,flood,earthquake,hail,andsnowdisasterwill
all adversely affect the industry operation and development. Natural disasters
occurring in and around the Company's production facilities may result in
substantial damages to production infrastructure or equipment. Furthermore,
natural disasters and extreme weather events can also drive up prices for certain
feed ingredients and meat. For example, at the beginning of 2023, southwest
China experienced winter and spring drought, leading to the continuous
development of drought conditions in some regions, and affecting various aspects
of the industry chain, including cultivation and livestock farming to varying
degrees. In the middle of 2023, central China experienced a wide range of
persistent rainy weather, causing a large range of crop disasters, which also had
an impact on the price of feed raw materials and affected the quality of raw
materials. The extensive heavy rain caused by a typhoon in southern China also
brought adverse effect on disease prevention and control of pig breeding.
Risk countermeasures: facing animal disease, the farms constructed by the
Company that are normalized and standardized ones staffed with professional
breeding technologists and equipped with strict anti-epidemic measures
effectivelypreventandcontroltheoccurrenceofepidemicdiseases.TheCompany
has also summarized a series of approaches and measures responding to major
animal diseases through years of experience accumulation to eliminate the impact
of various animal diseases. The Company has been guiding technicians to better
serve self-owned farms and external farmers by establishing animal healthcare
laboratories in various areas, creating nationwide animal healthcare system, and
conducting the monitoring and warning of animal diseases in real time.
Specifically,regardingtheswinefeveroutbreakin2018,theCompanyformulated
comprehensive prevention and control measures. These measures encompass
various aspects, including self-owned pig farms, collaborative finishing farms, pig
feed production plant and internal animal healthcare laboratories, with a view to
ensuring proper prevention and control from the source of animal nutrition,
enabling its biosafety prevention system and pig production indicators to reach
the leading level in the industry. The new round of attenuated swine disease that
broke out in several northern provinces from the end of 2020 to the beginning of
2021 brought new challenges to the industry in the early stage of the outbreak.
However, the Company continued to summarize its experience and upgrade
prevention and control and purification methods, including dual antibody and
dual screening in the whole group serum, application of thermal imaging devices,
and safe storage and disinfection of materials, and continuously optimized the
prevention and control process to ens