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  • Yongye's Cost Discrepancy [View article]
    No, Policeman, it does not call to question KPMG audits, not at all. But one might question Richard's math, again.
    1. Why does he not consider, at all, the obvious raw material plus manufacturing cost difference between animal and plant product?
    75 % vs. 60 % of total cost of goods, as is stated in the documents he quotes.
    2. Why does he not consider stated gross margin differences between animal and plant products? Plant product margin is about 58%. What is animal product margin? We now it is less - slightly less- maybe 54 or 53 %.

    Both of the above factor in his cost calculations, but are not considered at all. Why? Maybe because then he might not have a case.

    One thing is certain - SeekingAlpha needs to hire some competent fact checkers.
    May 1 10:51 PM | Likes Like |Link to Comment
  • Tibet Pharmaceuticals Looks Like A Terrible Bet [View article]
    Dear Author or SeekingAlpha, which ever can do it first:

    what is your comment to this comment on, well, likely on more informed site:

    please scroll down the page and enjoy.

    Also could you explain why there is at lesat two different HTTP addresses for the same auction?

    Here they are:

    Auction company wants make sure that roaming people just banging keys will somehow get to their site?????
    Mar 22 10:41 PM | 1 Like Like |Link to Comment
  • Yongye International: Further Evidence Calls For Regulator Scrutiny [View article]
    take a look at the pH number displayed (if it is) with price quote. Consistently over 6 which is quite different from pH 1.0 required with Yongye's process. The prices you and Eiad are quoting are for cheap alkaline mix of high molecular weight and low molecular weight humic/fulvic acids. And most of the time, not even acidic mix.

    Take look:

    now find me a price quote for pH 1.0 water soluble fulvic acid, please.
    Dec 16 02:48 PM | 1 Like Like |Link to Comment
  • Yongye International: Further Evidence Calls For Regulator Scrutiny [View article]
    Dear Eiad,
    a little bit of chemistry from Wikipedia:

    Humic substances in soils and sediments can be divided into three main fractions: humic acids, fulvic acids, and humin. The humic and fulvic acids are extracted as a colloidal sol from soil and other solid phase sources into a strongly basic aqueous solution of sodium hydroxide or potassium hydroxide. Humic acids are precipitated from this solution by adjusting the pH to 1 with hydrochloric acid, leaving the fulvic acids in solution. This is the operational distinction between humic and fulvic acids.

    And from Yongye prospectus:

    This process, generally described, is as follows:

    1. Humic Acid is mixed with water and sodium hydroxide to form a solution.

    2. The Humic Acid is precipitated as a solid while maintaining the solubilized Fulvic Acid in solution.

    3. The solid Humic Acid and the solubilized Fulvic acid are separated.

    4. The Fulvic Acid Compound is then mixed with special nutrients for its plant and animal product lines.

    Point being: Yongye uses fulvic acid obtained from step 2 above i.e portion soluble only into highly acidic liquid. This is also known as low molecular weight fulvic acid. It is this portion that produces one metric ton of Shengmingsu per 50 kg in standard 5 % solution. . All your price quotes are for rather impure water soluble humic/fulvic acid mixes.
    Dec 16 01:03 PM | 4 Likes Like |Link to Comment
  • GeoTeam Corroborates Findings On Harbin And Deer [View article]
    Just to fair:

    After some digging I found the land grant minimum price page that works in my browser. It is available here:

    The Price list seems to be from 2006 (Let's hope China does not do inflation adjustments ). I assume that Xi'an is in Shaanxi province and that would make it grade 5, not grade 10 as AL says. Numbers for top 10 grades are below. I calculated price in yuan for 500 Chinese Mu also. Seems to match AL's price numbers, if not the grade. Numbers are in order:
    Grade--Price Yuan per sqr meter--Price Yuan per Mu--Price for 500 Mu (Yuan)

    1 840 560000 280,000,000
    2 720 480000 240,000,000
    3 600 400000 200,000,000
    4 480 320000 160,000,000
    5 384 256000 128,000,000
    6 336 224000 112,000,000
    7 288 192000 96,000,000
    8 252 168000 84,000,000
    9 204 136000 68,000,000
    10 168 112000 56,000,000
    Sep 17 01:08 AM | 1 Like Like |Link to Comment
  • GeoTeam Corroborates Findings On Harbin And Deer [View article]
    It seems that HRBN actually is prepared to pay the legal price while local authorities were quoting their discounted, but illegal, negotiated deal prices. But what do I know - I just read China Supreme Court decisions.

    HRBN's payment schedule for the land use grant deal is structured exactly in line what should keep it valid according to the China Supreme Court decision. Funny coincidence, indeed.
    Sep 15 09:24 PM | 2 Likes Like |Link to Comment
  • GeoTeam Corroborates Findings On Harbin And Deer [View article]
    I found some confusing information about pricing of land use rights for state owned land in China. Namely these quotes:

    "Development zone administration commissions
    have never had the power to grant land use rights,
    but continued misinformation on this point has
    made it necessary for the Interpretation to
    reemphasize it."

    "A negotiated price for a grant of land use rights
    that is below the applicable minimum price is
    invalid, but the grantee can elect to make the grant
    valid by paying the difference between the
    originally paid price and the appraised value (at the
    time of the grant contract)"


    The article is based on China's Supreme People's Court’s “Interpretation Regarding Trials Involving Cases of State- Owned Land-Use Rights Contract Disputes”, issued on June 18, 2005 and effective from August 1, 2005.

    Can somebody clarify?
    Sep 15 02:34 PM | Likes Like |Link to Comment
  • Lihua International Investors: Do You Believe In Miracles? [View article]
    That article starts with saying that Lihua draws Fushi's copper coated aluminum wire thinner. There is a problem with that - you can't do it. Believe me, I used to pay for my living while at college by working as a quality inspection supervisor at Nokia Metal Industries Cable and Wire division (this was before they went for cellphones). The copper coating is just too thin to survive and you end up re-coating it.

    Now, if Fushi really supplies Lihua with copper coated aluminum wire that is supposedly drawn/pulled thinner... then you have a really big problem with Lihua. So far, I have not seen Lihua ever saying that they draw copper coated aluminum wire thinner.
    Sep 14 08:06 PM | Likes Like |Link to Comment
  • Lihua International Investors: Do You Believe In Miracles? [View article]
    Dear Ian,
    effect of capital expenditures is cumulative (i.e. you need to add yearly expenditures to get the real picture). Do the PP&E accumulation calculation, put it into your table, for revenue jumps read management discussion to see when new capacity came on-line (good place to start would be 2009 10-K) and then re-write your article.

    BTW, with 14 -15% operating margin LIWA is not a world beater - not even in wire/cable business. Did you even bother to run a little ops margin screen before writing?
    Sep 14 03:20 PM | 2 Likes Like |Link to Comment
  • Yongye's Top Customers: Discrepancies and Inconsistencies [View article]
    Dear Richard,
    according to your logic in Claim 2 I don't see any difference which way one deducts province or customer sales from reported yearly sales. One should be able to deduct top province sales from reported total yearly sales and see some meaningful results. Let's do that:

    Total yearly sales, rounded off to significant 10K:
    13.14 million USD
    Yearly sales in top 3 three provinces:
    6.2 + 2.7 + 2.0 = 10.9 million USD
    Top 3 provinces deducted from total reported yearly sales:
    13.14 - 10.90 = 2.24 million USD

    Beijing customer (NOT LOCATED IN TOP 3 PROVINCES) had sales for 2007 valued at about 3 million USD. Not to speak about Dahlian customer (NOT LOCATED IN TOP 3 PROVINCES) or Jiangsu customer (NOT LOCATED IN TOP 3 PROVINCES). So, either your logic is garbage as I say it is, or Yongye, according to your logic, misreported sales for those customers. But if Yongye did misreport those sales then your calculation for Inner-Mongolia sales cannot be correct - it is just garbage. Again according to your logic.

    How about admitting that you just cannot combine sales by province with sales by customers in any meaningful calculation. And also admitting that the same logic is faulty in several other claims of yours.

    However, I do have feeling that the argument above is beyond the minds present at SeekingAlpha editorial board. So,
    Good luck to all you fellas there when it comes to question of aiding and abetting.
    May 7 12:14 AM | 5 Likes Like |Link to Comment
  • Yongye's Top Customers: Discrepancies and Inconsistencies [View article]
    Richard (ECD),
    You argument is not with me it is with math. You are comparing apples to oranges, and there is not way out of it.

    I am just waiting SeekingAlpha to pull this malicious attack. Yes, that is also a legal term. I think the article and your comments are enough proof of malice.
    May 6 08:14 AM | Likes Like |Link to Comment
  • Yongye's Top Customers: Discrepancies and Inconsistencies [View article]
    Dear Richard.

    Lets' take your claim #2.

    Here goes Richard.
    Claim 2.
    "According to Item 3, the top five customers represented $10,767,153 of sales in 2007 and no top five customer was in Inner Mongolia. But total sales were $13,137,406 per Item 2, so sales in Inner Mongolia had to be less than $2, 370, 253 ($13,137,406 - $10,767,153), which contradicts Item 1's $2.7M number for Inner Mongolia, a discrepancy of at least $0.3M."
    Beijing sales (not in Inner-Mongolia and not in Top 3 provinces)
    2.98 Million USD
    Dalia sales (not in Inner-Mongolia and not in Top 3 provinces)
    1.22 Million USD
    Jiangsu sales (not in Inner-Mongolia and not in Top3 provinces)
    0.74 Million USD
    Total of these three (not in Inner-Mongolia and not in Top 3 provinces)
    4.94 Million USD

    According the logic you are using to do your calculations this claim.
    I should be able to add sales of top 3 provinces to that 4.94 million and the sum SHOULD NOT EXCEED the total sales for year 2007. Lemme see, with little rounding we get:4.94 + 10.80 = 15.74 Million. Reported total sales for 2007 was as you say above about 13.14 Million. What happened? 122% of total sales not less than 100%.

    Well, you faulty logic happened. You just can't map sales per customer to sales per province. Al least some Yongye's customer DO SELL IN MORE THAN ONE PROVINCE. That, BTW, is also shown by the presence of Beijing in top 5 customers, but not in top 3 provinces. You keep including some sales twice when you use customer table to calculate something from province table or vice versa. Garbage results.

    Worse, you seem to repeat the same error, all over your expose - at least in claims 10, 11, 13, 17,19 and 20. You state your are short on YONG in an article that has provably misleading information even using the numbers in the article. Funny, isn't it.

    I wonder how this piece ever got thru SeekingAlpha's editors. Or should we take that SA now stands for Shorties Alliance?
    May 5 11:58 PM | 9 Likes Like |Link to Comment
  • Yongye International Response to Blogger's Red Flags Falls Somewhat Short [View article]
    HI Clayton,
    "But, is Hebei owned by a related party? That is the key amidst the legal mumbo jumbo."

    1. Yongye stated that the ex-Hebei distributor was not a related party and the identity of the distributor is known by KPMG as a part of customary audit process with Yongye.

    2. Yongye bought-out the said Hebei distributor and for a good reason. It looks like the ex-distributor tried to squeeze Yongye by withholding ordering one season, then dumping an order bomb on the company during the next. That kind of behavior by a client makes production engineers lose sleep.

    3. As a result of (2) Yongye is now responsible for province level operations in Hebei.

    Hopefully this clarifies things a bit.

    I just wonder, How such a smart guy like Ian B., being in possession of all the pertinent facts about Yongye's dealings with Hebei distributor, did not present this in his article. Maybe on purpose. Naaah - Ian does not try to mislead. Why would he. And as a thorough and proud research Ian must have been aware what is said about reporting responsibility in SEC regulation SCH 13-G (5% ownership). It just slipped out of his mind while he was writing.

    Regarding SEC regulation S-K Item 101. I do agree with the disclosure of names is required. I just can't find evidence that SEC would ever have taken any actions based on the naming requirement, if the existence of major clients is otherwise made clear. And that is the case with Yongye.
    Mar 25 10:44 AM | 1 Like Like |Link to Comment
  • Yongye's Recent Filings Raise Various Red Flags [View article]
    You say that somebody is violating SEC regulation S-K. Check with SEC why they are not enforcing it and meanwhile read SEC SCH 13-G about reporting the stock ownership. Ian should do well to read it, also. For education - would shorten his articles a bit. Also, you two, why do think Yongye acquired Hebei distributor - because of their love for volatility or to get rid of the source of volatility? Should not be a hard question to ponder, it is actually very logical, isn't it.
    Mar 24 12:45 PM | 2 Likes Like |Link to Comment
  • China MediaExpress Holdings: All Eyes on Deloitte [View article]
    I have never seen you state that MW's miss on ONP lowers their odds on CCME. Be balanced, please.
    Mar 8 09:05 AM | 2 Likes Like |Link to Comment