At different stages of the whole production process, we perform a number of quality inspections and testing procedures, including sensory testing, physicochemical index evaluation, total bacterial count testing, veterinary drug residue testing, somatic cell testing and pathogenetic bacteria testing, to ensure that our raw milk complies with applicable PRC health and safety regulations for food products. In addition to our own routine inspections, we also submit our raw milk to the livestock breeding guidance center in Heilongjiang to inspect the quality of our raw milk.
Control Over the Quality of Dairy Cows
The quality of dairy cows directly affects the safety and quality of raw milk. Currently we breed our own high-quality Holstein dairy cows. We inseminate our dairy cows with the semen from selected Holstein bulls sourced from Canada and the United States, to improve the genetic mix of our herd. We purchase frozen semen of selected Holstein bulls from international suppliers either directly or through third-party domestic trading companies, and require a quarantine report of each bull that supplied the semen before the semen is accepted. We assess the semen based on various factors, including the nutritional content of raw milk produced by the bull’s offspring, and the milk yield and health condition of the bull’s offspring.
Control Over the Quality of Feed
Feed quality can materially affect the quality and yield of raw milk. We have implemented a
centralized system for feed procurement and inspection which helps us to maintain stable and highquality feed supplies, and we purchase the concentrates and forages from international suppliers through either third-party domestic trading companies or agents, and domestic providers. We have contracted with local suppliers to plant corn silage for us. Feed delivered to our dairy farms by our suppliers is quarantined while our laboratories perform the requisite sampling inspections. Such feed is accepted and stored in our warehouse only after approval by our enterprise management department. Feed that fails the inspection is rejected and immediately returned to the suppliers.
Quality Control During the Milking Process
We adopt standard milking procedures at all of our dairy farms. We carry out the extraction of raw milk in an automated and sanitary environment to ensure milk quality and safety. We continuously monitor our milking process and carry out inspections during the process to ensure consistency in the quality of our raw milk and compliance with applicable milk safety standards. To ensure the safety and quality of raw milk, we spray the teats of dairy cows with sterilizing fluid before milking commences and clean dairy cows’ teats with dry towels before attaching the milking cups. We discard the first three squeezes of raw milk from the dairy cows. After the milking process is complete, we sanitize the teats of dairy cows once again to protect cows from infection. We also clean and sterilize the teat cups before milking. Such milking procedures, combined with our strict disease control procedures to maintain the overall health of our herd and clean living environment for our cows, enable us to produce high quality raw milk with low microbe count and low SCC.
Quality Control During Storage and Transportation
Following completion of the milking process, we carry out further testing and inspection before the raw milk leaves our farms and is delivered to our customers. Prior to delivery, we inspect and test our raw milk for, among other things, veterinary drug residues, SCC, microbe count, protein content and fat content, and we generate a quality report for our internal records. All of the raw milk in the storage tank will be discarded if we detect any amount of veterinary drug residues that exceeds our safety standards, and there was no such incident during the Track Record Period.