Houston company becomes top alfalfa exporter

By May zhou in Houston | China Daily | Updated: 2016-05-06 11:38

It all started with a hay named alfalfa, which, like a seed, gave birth to S&S AgriSource Holding. In less than a decade, the little seed grew and spread, enabling S&S to become an agriculture company drawing investments from both Chinese and American investors.

Widely grown throughout the world, alfalfa is a premium forage primarily used for high-producing dairy cows because of its high-protein content and highly digestible fiber, and secondarily for beef cattle, horses and sows.

"Many people are surprised when they learn that China is buying hay from the US. Apparently it doesn't seem that cool compared to importing aircraft. But the fact is, agriculture products are China's main import from the US, and alfalfa makes up to 1 percent of the total imports," said Lisa Yang, founder and CFO of Houston-based S&S AgriSource.

As for alfalfa, China has been the biggest buyer of the product from the US since 2014. In 2015, China accounted for 45 percent of the alfalfa exported from the US.

"We believe the market will continue to grow due to China's dairy sector growth and its resource and infrastructure limitations," said Yang.

By 2015, S&S AgriSource had become the fourth-biggest US alfalfa hay exporter to China. The company's total exports accounted for 18 percent of all alfalfa imported by China. Its clients include China dairy giants such as Yili, Modern Dairy and Bright Dairy.

S&S AgriSource's major operations are located in Western states, such as California, Idaho, Utah and Arizona, where plants produce the most hay for exporting.

"Our people in the purchase department live and travel between different fields all year round; some of them can't stay with their families for most of the year. They are our backbone," she said.

Most of the company's 30-plus employees are Chinese who graduated with an American university degree, according to Yang.

"It's not easy for an international student to get a job after graduation, especially considering the additional cost a company needs to pay to sponsor a foreign worker when the economy is stagnant. But we want to help those hard-working young people with the American dream to succeed and grow with us. We even consider offering company shares to our excellent employees, all of whom will have the opportunity to become shareholders in the coming years," said Yang.

To gain a firm foothold in the industry and secure a stable supply of alfalfa, S&S AgriSource has kept moving up the production chain.

In 2013, the company acquired a 72,000 square-foot warehouse in Long Beach, California. The warehouse is strategically located by a railroad and 20 minutes away from Long Beach Port. The company can transport alfalfa from inland farms for pressing and packaging and ship to China by boat with low transportation costs.

In 2015, the company moved further up the production chain by purchasing more than 1,200 acres in Idaho to grow its own alfalfa. "The land is of USDA certified organic soil for growing alfalfa. We integrated our production chain upstream so that our company can develop sustainably. We now compete in the production line, from growing and processing to exporting," said Yang.

mayzhou@chinadailyusa.com