Muyuan Foodstuff Co Ltd

The company conducts initial local area inspections before each farm’s construction. Once the site is built, a site-wide survey is conducted twice a year. The company further explained how water resources, including wastewater, surface water and groundwater, are tested from the start of use of the operations in question. Muyuan also mentions how the site selection process for its pig farms is performed by a dedicated planning and design team which chooses the location based on the company’s production needs as well as the water requirements of the pig herd. The company uses an internal methodology to assess water risks. However, it does not disclose the parameters used to classify an area as being "high, medium or low" risk from a quality perspective. The company does not disclose information about operations located in areas of high or medium water risk.

The company discloses the average concentration of COD, ammonia, total nitrogen, and total phosphorus for all its sites. Except for total nitrogen, the company's average wastewater parameters are below the IFC EHS guidelines limits. However, this is a weighted average for all the sites, and it is not clear the % of sites whose individual parameters are in line with the IFC EHS guidelines. The company also discloses that it received five fines in different subsidiaries due to wastewater pollution.

The company recognises that pollution and changes in water quality and soil on the farms may lead to a decline in biodiversity. The company says that to avoid this, it follows the requirements of relevant laws and regulations and conducts environmental assessments before the construction of the project, and it carries out regular assessments and monitoring after the construction of the farm. However, the company does not discuss or disclose areas of high biodiversity value and/or water stress in geographic regions where it operates.

The company includes all its operations in the risk assessment, including livestock farms, as the company owns 100% of the sourcing farms. In phase 1, the company mentioned that it purchased all its feed raw materials from trading companies, and it does not have visibility of nutrient pollution at that stage of the value chain.

The company does not disclose this information. In phase 1, the company mentioned that it purchased all its feed raw materials from trading companies.

The company does not disclose this information.

The company has audit systems in place to monitor the implementation and execution of animal welfare policies, as well as biosecurity, and environment control. It is unclear whether pollution is also monitored.

The company discloses that wastewater from pig farms is treated by solid-liquid separation and anaerobic fermentation, among other processes. It seems all the wastewater is treated before being used. In the engagement call with FAIRR, the company mentioned that in northern China, where there is more farmland available, the company uses a storage pond where the waste is stored for six months or more until it is needed by farmers, who use the water as fertiliser. The company mentioned it uses a treatment which implies removing heavy metals, and hazardous substances. In the south, the company mainly utilises anaerobic treatments. The different practices in the north and south of China are due to Muyuan’s own policies based on local conditions, rather than mandated by regulations. The company has adopted anaerobic fermentation technology for disposal of pig manure and treatment of production wastewater. The biogas produced is used for electricity generation and farm operation, the biogas slurry is applied to crop fields, and pig manure and biogas residues are composted and fermented after solid-liquid separation to produce organic fertilisers. The company offers application advice to farmers based on soil sampling to avoid over-application and pollution.

The company discloses an overall target to reduce wastewater metrics for its slaughtering factories, including COD and ammonia nitrogen emissions targets.

The company mentions that it actively promotes the combination of crop planting and pig farming. The company explains that it provides integrated manure utilization and scientific planting services by agronomists to third-party arable farmers that grow fruits such as oranges and apples. The company also mentions that it tests the soil nutrients before manure application and customizes schemes for each farm and cropland. In the engagement call with FAIRR, the company mentioned it engages roughly 300,000 farmers in its project to provide manure to fruit farmers. In previous reports, the company disclosed using a feed receipt with lower protein content to reduce nitrogen emissions in manure. However, this information is no longer available in the public reports.

The company does not disclose this information.

The company does not disclose this information.

The company does not disclose this information.

The company provided a response to the investor letter and responded to the engagement questions. The company met with investors within the engagement period. The company acknowledged the FAIRR’s assessment and provided feedback.