AgFeed believes in franchise formula

Songyan Li, chairman of AgFeed Industries said: “Since we pioneered the model of
independently owned franchise chain store sales in January 2007, we have
experienced significant success both in product sales and new sales channel
development.

“Our current dual channel product distribution system is
unique and highly effective in our industry. We have developed over 600
nationwide wholesalers targeting commercial hog farms and over 120 franchise
chain stores targeting individual farmers.

More distribution
units
“We will continue to deepen market penetration by adding new
distribution outlets throughout the year. As pork prices are at the highest
level in the last eight years in China and as wealthier Chinese consumers demand
more and quality meat products, we are experiencing strong sales for our
products across all product lines.”

John Egan, Jr., an AgFeed independent
director and who visited Agfeed recently in China, commented that, “abundant
opportunities for acquisitions exist in the vast and highly fragmented animal
nutritional feed market in China.”

Three takeovers
AgFeed
announces that it is in various stages of discussion to acquire three additional
businesses in the animal feed industry, which it expects to finalise in the
coming months. The company expects the three businesses to contribute additional
revenue and net income to AgFeed.

About AgFeed
AgFeed
Industries is the first China-based animal nutritional product company publicly
traded in the US.

Through its operating subsidiaries which were founded
in 1995 in China, AgFeed is a leading manufacturer, marketer and distributor of
premix animal nutrition products targeting China’s vast and growing animal feed
market.

China’s animal feed market was approximately $40 billion in 2006
according to China Feed Industry Association.