Zoono Group Limited (Company) (ASX: ZNO) is pleased to advise it has entered into an exclusive distribution agreement (Agreement) with China Animal Husbandry Group (CAHG). CAHG is a Chinese, State-Owned Enterprise specialising in all things regarding animal health in China.
This is the first time Zoono has signed a strategic agreement with a China Central Government owned enterprise and believe this is of great significance for the Company and will lead to more, similar agreements now that the Chinese Government is aware of Zoono’s technology.
The primary focus will be on dairy, poultry and pigs; Under the Agreement, Zoono and CAHG will work in close collaboration to aggressively expand the use of Zoono in the dairy, poultry and pig markets. CAHG are currently arranging for regulatory approvals, estimated to take 3 to 6 months, with the expected rollout commencing on receipt of these approvals. Negotiations with CAHG commenced in Q1 last year. CAHG tested Zoono-Z71 in local laboratories against common pathogens found in this industry and, based on the results, has entered into the Agreement with Zoono. CAHG is heavily invested in New Zealand companies having invested several hundred million dollars in New Zealand companies over the years. Zoono is very pleased to have finalised this agreement with CAHG.
The following then provides an indication of the huge dollars that are involved in this massive China market.
The Pig Farming industry in China is expected to grow at an annualized 13.7% over the five years through 2021, to $85.7 billion. In 2021, industry revenue is expected to increase by 6.7% to $130.3 billion.
Being the world’s largest pig producer and consumer makes China highly vulnerable to ASF (African Swine Flu). By the end of August 2019, China had already seen its pig inventories reduced by nearly 40 percent from one year earlier. The animal disease was estimated to have led to a direct economic loss of one trillion yuan ($141 billion).
Revenue for the Poultry Farming industry in China is estimated to grow solidly at an annualized 5.6% over the five years through 2021, to total $130.3 billion. This trend includes anticipated growth of 6.7% in the current year.
The China Companion Animal Health market was valued at USD 567.28 million in 2020, and it is expected to reach USD 1,102.25 million by 2026, registering a CAGR of 11.71% during the forecast period of 2021-2026.
GLAH
ZNO Price at posting:
30.0¢ Sentiment: Buy Disclosure: Held
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