Chaoda Modern Agriculture has committed to opening four new vegetable processing plants in China, costing 60 million yuan to 70 million yuan each. Chairman Kwok Ho said the company had set up a trading arm in Japan two years ago to try to ensure higher profit margins. However, as it was more effective to employ local expertise, it had formed a 42 per cent-held joint venture with European partners to sell fresh produce under the Chaoda trademark. 'Citrus sells at 2.3 yuan per catty domestically, with a profit margin of 67 per cent. But we sell it at 4 yuan per catty to overseas companies,' said a Chaoda manager. Exports, including sales to Europe, Japan and the United States, accounted for about 30 per cent of total revenues in the past two financial years, according to the company. Last month, Chaoda unveiled a plan to develop a dairy cattle production base in Inner Mongolia, which will initially house more than 3,000 dairy cattle, including 600 cows imported from Australia and New Zealand. The production base, designated to house up to 30,000 dairy cattle, will be one of the largest in China and total investment is likely to exceed 400 million yuan. About 200 million yuan has been invested in the first phase. Dairy cattle are assigned a higher commercial value than beef cattle, with the typical price tag for a dairy cow being 20,000 yuan against 2,000 yuan for a beef cow. To predetermine the gender of a cow embryo, Chaoda has made use of sex-control technology developed by the scientist Jerry Yang at the University of Connecticut. Chaoda spent 80 million yuan last year in research and development, or 3.6 per cent of revenue. 'When a dairy cow is able to produce more than five tonnes of milk in its lifetime, dairy production is worth the investment. If production reaches seven to 10 tonnes, annual revenues may reach 11,000 to 12,000 yuan,' Mr Kwok said.