The pea power of a production-and-marketing professional cooperative

On August 20, the site of the rebate meeting of the Beijing Rongtao Pea Production and Marketing Professional Cooperative was packed with people, and hundreds of expectant eyes were fixed on cooperative president Zhang Tao. When this female leader announced that the board of directors had decided to pay a uniform rebate of six mao per jin based on pea output, the scene immediately erupted in thunderous applause. The members clapped hard, and some simply stood up……

In the more than six years since the Rongtao Cooperative was founded, it has focused on doing just one thing well: peas. Through standardized development it has maximized the interests of its members, and it has already brought along more than 4,000 surrounding farming households. Its 150,000 mu planting base radiates across a 500-kilometer range centered on Pinggu, and its total assets have reached more than 30 million yuan. The cooperative funded the establishment of a food company, and the small pea has achieved integration with a large industry. Zhang Tao's “pea dream” has also become clearer and clearer.

Pea affection——

From a small mountain village to a family farm owner

Zhang Tao is a native of the local area. She came from a hard background. Her father died early, and her mother was bedridden year-round. After her grandmother passed away when Zhang Tao was 11, she took on the entire burden of the family. To make a living, Zhang Tao sold New Year cards and sold ice cream; only after she married and she and her husband began “trading” agricultural products using a tricycle bought with money borrowed from relatives did their lives become tied to peas from then on.

“Peas are in tighter supply than other agricultural products, with higher profits, and the local area also has a tradition of planting them, growing melons and beans around the house.” Zhang Tao said. As business grew bigger and bigger, they had to travel far to Gansu and other places to source goods. In the process, they discovered that one mu there could produce five or six hundred jin of peas, fully double that of Pinggu!

After making many inquiries, they learned that this was due to a new variety from the Chinese Academy of Agricultural Sciences. With the coordination of district and township leaders, Zhang Tao finally met the pea expert Sun Yunyue. In 2001, under the expert's guidance, 27-year-old Zhang Tao contracted 80 mu of land in Taipingzhuang Village to trial-plant peas. “I wanted to see whether it would really work. Only if I planted well myself would it be convincing to others.” she said.

Normally the couple mainly did the work themselves, and during busy farming seasons they simply hired laborers——just like that, more than ten years ago Zhang Tao and her husband became “family farm owners.” In the first year they used a corn seeder with wide and narrow rows, achieving a yield of more than 600 jin per mu; in the second year they used a wheat seeder with “paired rows,” reaching 700 jin per mu. At that time, such a yield was unimaginable in the surrounding areas.

With practical experience in hand, starting in 2003 Zhang Tao encouraged the villagers around her to plant together. At first, everyone did not believe this little girl in her twenties. Mei Shubao, a “old hand” in his fifties, interrupted Zhang Tao as soon as he heard the yield, but Zhang Tao told him that with the new variety alone the yield per mu could double, and with a set of field management techniques the harvest was certain to be guaranteed. “If you make money, it's yours; if you lose, it's mine.” Zhang Tao told the villagers. Sure enough, after the summer harvest everyone's “pockets bulged.”

The pea road——

The cooperative strings together thousands of households' dreams of prosperity

New problems followed. Everyone asked whether, once the yield went up, all the peas could be guaranteed to be purchased. To eliminate their concerns, Zhang Tao began the initial cooperation with the villagers——signing purchase and sales contracts, with a floor purchase price of 1 yuan per jin of peas, relatively high in the market.

When the accounts were settled at year's end, Zhang Tao had earned 0.46 yuan per jin of peas. She kept the 1 mao per jin profit she had expected, and returned the remaining 0.36 yuan entirely to the growers. “At the time I thought making money depended on everyone, and it was enough for me to reach my own expectation.” Zhang Tao said frankly when asked about her thinking back then. Some farming households were so moved that their eyes brimmed with tears when they received this “pie” that had fallen from the sky. From then on, the pea planting area of the farming households around her soared from one or two thousand mu in 2005 to twenty or thirty thousand mu the next year. Contracted farming households reached two or three thousand, and at his peak Mei Shubao planted close to 200 mu of land.

In 2008, the Beijing Rongtao Pea Production and Marketing Professional Cooperative became one of China's first batch of officially registered cooperatives, with 527 member households and registered capital of 2.68 million yuan at 1,000 yuan per share.

Relying on scientific research resources and working with Professor Sun and others on variety selection and breeding, the cooperative has had new pea varieties named Rongtao No. 9 and Rongtao No. 10, which are sold as far away as Sichuan, Yunnan, Hubei and other places. Members enjoy technical services and the benefits of seed at cost price and pesticides and fertilizers at wholesale price; for the use of farm machinery they only need to pay the operator's wages. Externally, it registered the “Rongtao” brand trademark and pursued a branded development path.

With an organization in place, Zhang Tao also signed minimum protective-price purchase contracts with members as usual, and in a more scientific way: when the market was low, the protective price served as a floor, and when the market was high, purchasing was done at the “protective price + market floating price.” Strictly in accordance with the cooperative law, 10% of the surplus was retained as an operating risk fund, and the remaining 90% was returned to members in a 4:6 ratio based on capital contributions and transaction volume.

Last year the cooperative's sales of seeds, raw materials and food exceeded 8,000 tons, with an output value of 65 million yuan and rebates of 5.6 million yuan, increasing each member household's income by an average of 40,000 yuan. This year is another bumper harvest year. The cooperative's bases have extended to Shangdu, Chifeng and other places in Inner Mongolia, and it has recovered 6,400 tons of dry peas, with a 100% recovery rate for members. The first rebate based on transaction volume, just concluded, returned 7.08 million yuan.

The pea dream——

A leading enterprise boosts major industrial development

As the cooperative grew stronger day by day, Zhang Tao had a longer-term idea: “Members enjoy more of the planting returns, but the returns from the production, processing and sales links have all been taken by other enterprises.” So with the support of the local government, in 2010 the cooperative funded the establishment of Rongtao Food Co., Ltd., with Zhang Tao as general manager representing the cooperative in safeguarding the investor's rights and interests in the enterprise.

Wang Hongyan, the deputy district head in charge, said that usually it is leading enterprises that establish cooperatives, but Rongtao has achieved the feat of a small cooperative establishing a large enterprise. At this point, the trinity development model in Zhang Tao's mind of “dragon head (leading enterprise) + dragon body (cooperative) + dragon claws (farming households)” had basically taken shape, and a full industrial chain integrating scientific research, seed production, promotion, planting, processing and sales had been opened up.

60% of the company's profits are returned to the cooperative, and when dividends are distributed they are included in the year-end surplus and allocated according to regulations. The remaining 40% serves as operating funds for the enterprise. Enterprise management personnel, including Zhang Tao, are hired by decision of the cooperative and uniformly receive a monthly salary of 5,000 yuan.

At present, the company is the only local agricultural product processing enterprise in Pinggu Xinggu Development Zone. It has built 10,000 sq m of standardized factory buildings and purchased 2 pea frying production lines, 1 pea baking production line, 30 automatic measuring-cup packaging machines, and 1 fully automatic metering packaging machine. It produces two major categories and 15 small varieties of pea products. Last year it achieved sales revenue of 50 million yuan, of which more than 2 million yuan was returned to the cooperative.

“Rongtao Company has truly realized the goal that ‘the enterprise belongs to the cooperative.’” Zhang Tao said. The enterprise's raw materials and products belong to the cooperative, and apart from most of the management, who are externally hired, the employees are also members or members' relatives. “The company has a strange phenomenon: there is no dedicated loading team. Employees treat the enterprise as their home, and when there is work everyone pitches in.” said Hou Yanjun, the company's deputy general manager in charge of sales.

This year the company plans to develop a new project investing in pea protein and starch extraction lines. Once completed, it will be able to process 30,000 tons of peas annually, producing 4,500 tons of pea protein powder and 13,500 tons of starch. Zhang Tao said that pea protein is a non-allergenic protein, contains no anti-nutritional factors, and contains all the amino acids essential to the human body. Its nutritional value is superior to other legume proteins and animal proteins. After production begins, it will fill the gap in protein powder, especially pea protein powder, production in Beijing and even North China.

The Rongtao Cooperative has been rated as a national-level demonstration cooperative, and Rongtao Company has been rated as a Beijing municipal leading enterprise. On the wall of the new workshop, the reporter saw two striking banners——Looking back on six years of struggle, the pea dream has become fuller and fuller; looking ahead to future prospects, the road of cooperation is growing broader and broader.