January 30, 2004

Global Bio-Chem Doubles Lysine Output

Global Bio-chem Technology Group Company Limited reaffirmed its position as China's number one lysine producer and one of the top three lysine producers worldwide with the commencement of commercial production of protein lysine in the group's joint venture company. Global Bio-chem's lysine production capacity is now more than doubled to 100,000 metric tons per annum.

The Changchun Baocheng Bio-chem Development Co., Ltd. ("Baocheng Bio-chem"), the joint venture company of Global Bio-chem, is located in the corn industrial development zone in Changchun, China. Taking advantage of its proximity to an abundant supply of raw materials, Baocheng Bio-chem can produce approximately 60,000 metric tonnes of protein lysine (65 per cent to 70 per cent lysine concentration) or 40,000 metric tonnes of pure lysine (98.5 per cent concentration) per annum. This not only enables the Group to expand its market coverage in the PRC but also helps the Group to broaden its customer base in the European and North American markets.

"The market for protein lysine as feed additive has been growing, with increasing popularity in the poultry industry. The commencement of commercial production of protein lysine increases the Group's lysine variety, expands its customer base in overseas markets and strengthens its market share in China. Global Bio-chem's advanced lysine production technology and large production capacity further consolidate its position as a leading lysine manufacturer in the world," said Mr. Liu Xiaoming, the Chairman of Global Bio-chem.

In 2003, the Group sold approximately 4,940 metric tonnes of lysine to overseas markets, representing 10.5 per cent of its total lysine production. The Group estimates that in 2004, exports will increase to 25 per cent of its total production, i.e. approximately 25,000 metric tonnes. With strong demand growth in China of over 10 per cent per annum, and a steady growth in the overseas market, the Group envisages enormous room for market expansion.

In July 2003, the Group's wholly-owned subsidiary Global Bio-chem Technology Limited ("GBT BVI") and 90 per cent owned subsidiary Changchun Dacheng Bio-chem Engineering Development Company Limited ("Changchun Dacheng Bio-chem Engineering") entered into a Joint Venture Agreement and a Supplemental Joint Venture Agreement with Changchun Dacheng Industrial Group Company Limited ("Dacheng Industrial"), to establish Baocheng Bio-chem.

About Global Bio-chem

With a listing on the Main Board of The Stock Exchange of Hong Kong Limited, Global Bio-chem is principally engaged in the manufacture, research and development of corn based biochemical products in China. Its products are sold in China and other countries in Asia, Europe, North America and Africa.

Headquartered in Hong Kong and with its production facilities based in Changchun, Jilin province, Shanghai and Jinzhou, Liaoning province in China, the Group is the largest lysine producer and the largest vertically integrated corn based biochemical product manufacturer in China, with an annual corn processing capacity of 1.2 million metric tonnes and an annual lysine production capacity of 100,000 metric tonnes at present, and approximately 1,400 employees.