25th Apr 2014 12:09
LONDON (Alliance News) - Taihua PLC Friday responded to recent bulletin board speculation concerning the wholesale prices obtained for the Forsythia crop, saying that the pricing of unprocessed Forsythia, which it sells, has not followed the upturn in the price of processed Forsythia.
In a statement, Taihua said a key reason for the difference in pricing between processed and unprocessed Forsythia is that Taihua's Forsythia customers have incurred a one-off GMP compliance cost in 2013.
Prior to 2013 they could sell processed Forsythia without GMP certification but this was not the case from 2013, Taihua said.
As a result, the directors believe they have sought to pass on some of the costs to the suppliers of unprocessed Forsythia, Taihua added.
This has resulted in the 2013 price for unprocessed Forsythia remaining stable in comparison with 2012 pricing, Taihua said.
"The company confirms that, as its crop is the unprocessed Forsythia, the price per kilogramme in Luonan County where Taihua's plantations are located is around RMB28 excluding tax, as opposed to the price for processed Forsythia, for which the price on the pharmaceutical wholesale markets is around RMB38 to RMB45 per kilogramme excluding tax," Taihua said in a statement.
There are two stages in the marketing of Forsythia. The initial stage is the sale of unprocessed Forsythia, which is the product sold by Taihua. The second stage is the sale of processed Forsythia which is sold by Taihua's customers. The difference between the unprocessed and processed Forsythia is that the processed Forsythia is subject to further selection, processing, drying and packaging.
Taihua shares were Friday quoted at 2.875 pence, untraded.
By Samuel Agini; [email protected]; @samuelagini
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