manynovel #522 - Arm wrestling
#522 - Arm wrestling
Southeast Asia.
With the success of hybrid rice, Dongda's agricultural support began to extend from rice to cultivation and breeding. Technical personnel from Dongda's feed manufacturers, after several years of promotion, found a path to prosperity for farmers in the demonstration zone through planting hybrid rice and hybrid corn, and breeding pigs, cattle, sheep, chickens, ducks, and geese.
Although the current coverage of the demonstration zone is less than one-tenth of these countries, the rapid enrichment of these demonstration zones has spread throughout these countries like a spring breeze.
Because Dongda supports a decentralized planting and breeding model for the vast number of farmers, it supports the development of the vast majority of local people together.
This is incompatible with the centralized, large-scale factory model of large European and American consortia. As a result, facing Dongda's gentle and subtle support, the two sides began a secret struggle in the demonstration zone.
"Why have our local production and sales declined so much? The poultry sector has fallen by more than 50%. This is unacceptable." White, the president of Anlishikang Food Group in Malaysia, looked at the report and roared at his subordinates with a livid face.
"Mr. President, this is because the competitors we are now facing are not only those large breeding farms and farm owners, but also many farmers and breeders." Moro, the business manager in charge of local market development, explained with a stiff upper lip.
"In areas such as Penang, Johor, and Sarawak, local farmers are almost all starting to become breeders. Not only is the grain they grow enough to be self-sufficient, but they also receive support from Dongda Feed Enterprise for the poultry and livestock they raise. Dongda International Agricultural Company's food company promises to buy their surplus products, whether it is grain products or poultry and livestock products."
"Do you know what their profit margin is?" White continued to ask with a gloomy face. Dongda's actions have almost created a closed loop for this industry, which makes him feel a little helpless.
"According to my observation, Dongda basically purchases grain and poultry/livestock at market prices, with basically no price difference in between. The cost of raw material procurement is higher than our large-scale farm costs, but Dongda Food Company doesn't seem to care about profits at all. They don't care too much about this slightly higher cost, seemingly pursuing a break-even state."
"What are they after?" White was a little frantic facing such an opponent.
"However, Dongda has sold a considerable number of agricultural vehicles in these places. They have also obtained local road construction rights and toll rights. It is said that it is a 20-year toll right, and after the expiration, regardless of whether the cost has been recovered, these built roads will be handed over to the local government and owned by the local government." Moro really put his heart into it, and was able to find out and connect this information.
This allowed White to have a complete overview of the whole matter.
However, after listening, White found that they basically had no means to deal with Dongda's combination of moves.
Although large-scale breeding is the optimal choice in terms of cost, Dongda doesn't seem to be thinking about directly making money from these places, but rather taking a long-term approach, supporting these places to develop slowly.
Even if White couldn't figure out how Dongda would recover these costs, he knew that Dongda was definitely not crazy and messing around in these places.
They must have a way to recover the cost with interest, but it is indeed difficult for him to think of what it is!
As a food company, Anlishikang targeted the advantages of cheap labor and raw materials here, so it set up a food factory here and also established a large breeding farm to provide itself with production raw materials.
Unexpectedly, after Dongda quietly entered, it completely subverted the local planting and breeding methods in just a few years!
The good results of the demonstration have completely established everyone's confidence in Dongda's planting and breeding model.
In this way, the farmers who accept the Dongda model almost cover all the local people.
The entire scale was pulled up at once, so Dongda Agriculture International Company's food company had something to do locally. After receiving the grain and poultry/livestock, they processed them into canned food and agricultural and sideline products such as rice, which were sold locally and to surrounding countries. These products are relatively scarce in these surrounding areas.
The local people have indeed gradually had surplus money relying on this model. According to their needs, they preferentially purchased cheap but easy-to-use products from Dongda such as tricycles and agricultural vehicles.
Such a noble operating model left White with almost no loopholes to attack.
"How are we considering responding now?" President White simply dumped the problem to the subordinates if he couldn't solve it.
"Mr. President, we can only increase investment in planting and breeding and build super-large breeding farms to continuously reduce costs. In response to the current situation, we will appropriately increase the purchase price to influence the current vote and get through the immediate difficulties first."
"If we increase the purchase price, can the product price still be increased later?" White frowned and said.
"There is not much room for price increases in the sales of terminal products." Moro responded.
"Our products have always been slightly higher than our competitors, and we have maintained this price range by relying on our brand and becoming a leader among first-tier brands, but this situation has reversed somewhat this year. Dongda's product penetration is becoming more and more in-depth, and the varieties and types are also becoming more and more diverse. From agricultural vehicles to small production machinery, Dongda can always come up with something to sell to these wealthy farmers. Now, they like everything from Dongda, which is cheap, beautiful, and very practical."
"So, I suspect that Dongda is playing a very big game. They are not focusing on one point at all, but controlling us from a combination of an industrial chain or even different industrial chains. The terrible thing is that we simply don't have the ability to get rid of this temptation."
Starting from the perspective of conspiracy theory, Moro does not believe that Dongda has such a noble purpose to help their country achieve prosperity.
However, when Moro questioned Dongda's motives, he suddenly felt a sense of guilt welling up inside. This was because, as a result of the current situation, the farmers in his country had not lost anything. Instead, they were visibly improving. Not only had they long surpassed the need to simply survive, but their quality of life had also reached levels they previously couldn't have imagined.
So, to forcefully push some conspiracy theory about Dongda felt rather disingenuous.
Of course, Moro wasn't to blame for thinking this way. In reality, almost every capitalist from other countries who came here to start a company was only interested in making money, not in poverty alleviation. But Dongda was now breaking the mold, selling their products while genuinely helping the local people gradually become prosperous.
If this idea had been told to President White before, he would have scoffed and dismissed it as impossible.
But now, Dongda had turned this into reality. They had not only created a closed-loop system from agricultural planting and breeding to raw material sales and deep-processed product production and sales, but they were also starting to create closed-loop systems in seemingly unrelated areas, from road infrastructure construction to transportation vehicle sales.
It was as if Dongda was helping the local economy develop while simultaneously earning the money back from their comprehensive product chain.
Such a long-term design model, if it didn't have extremely strong product stickiness to compensate in other areas, would essentially be a charity.
It could be said that this model was too philanthropic, and few countries could achieve this.
The latest novels are on 69shu.com!
However, this was precisely the strength of this model, because it was difficult for foreign single-product merchants to compete with such competitors.
This was Ren Zhong's new model, imitating Dongda's approach in the main world. From the current perspective, it was very successful. What we bring to the local people is not unilateral market extraction, but a market cultivation approach akin to 'releasing water to raise fish,' which is far more complex than simple horizontal promotion and must closely cooperate with national power.
After several years of development, Ding Wei's International Agricultural Company has transformed from simple planting to an integrated complex of planting, breeding, and deep food processing. It is now one of the leading agricultural conglomerates in the Bright Sword world, starting to generate substantial profits to support the domestic economy.
Because after hundreds of millions of acres of land in Black Africa were transformed into fertile fields, they began to continuously produce large quantities of grains, wheat, corn, rapeseed, sesame, soybeans, and other food crops. Even if the main grain prices in the Bright Sword world were stabilized at a low level of $100 per ton, the International Agricultural Company now has an annual output of tens of millions of tons, with the annual output value of food crops alone reaching several billion dollars.
Combined with the food industry formed by deep processing of grains and oils, the current annual output value of the International Agricultural Company is as high as tens of billions of dollars or more.
Back in the Taihang Mountains, Ding Wei never dreamed that he would one day become one of the world's largest grain and food suppliers!
It was precisely because of the promotion of hybrid grain varieties and the blossoming of this affordable grain in various places that Dongda's win-win cooperation model gained support in more and more Third World countries.
Grain, infrastructure, basic transportation, basic energy facilities, and abundant light industrial products. Dongda, in its own way, exported its powerful industrial capacity to benefit the entire Bright Sword world. Southeast Asia and Black Africa, as the two major beneficiary regions, also achieved rapid economic growth, with more and more people participating in the new agricultural development model guided by Dongda, benefiting the large number of farmers in these countries first.
It began to unleash increasingly strong productivity.
It was through this trickle-down promotion that Dongda gradually entered the hearts of the people in these countries. They not only changed from their initial skeptical attitude to actively following, but also had a good impression of everything Dongda.
From bringing a new agricultural planting model that could fill their stomachs to bringing electricity, better transportation conditions, and a better life, Dongda, in this way, formed a stark contrast to other international capital focused on profit acquisition. As a result, Dongda won more support internationally, mainly in the Third World.
This laid a new foundation for deeper trade between the two sides. Then, when Dongda proposed joint mining of local mineral resources to further accelerate the development of the local economy, everything was logical, further expanding the trade between the two sides. Whether it was copper mines, iron mines, or coal mines, Dongda's rapidly developing infrastructure now had a large consumption capacity. And after realizing the diversification of mineral resource sources, Dongda in the Bright Sword world was not driven by its own strong domestic demand and export, leading to a large-scale price increase in the raw material market.
After all, this was still in the 1960s. The three major mining companies that monopolized upstream resources in the main world were not yet too successful. Through cooperation with John Bull and the binding of European financial families, several large colonies under John Bull's control were still firmly controlled by them, starting to cooperate with Dongda to extract and sell to Dongda.
Just like Nigeria and Rhodesia, the ore was exchanged on the spot for the grain that Ding Wei and his team planted locally, which not only reduced a lot of transportation costs but also created considerable channels for the release of labor in Black Africa.
Black Africans plant crops in Black Africa, and they take mineral ore back to their hometowns. Ding Wei and his team's efforts were exchanged for iron ore, copper ore, and even coal, which were sent back to the southern and eastern coasts by Dongda's huge transport fleet while continuously transporting new industrial products back to these places.
This was not only the case in one place, but Dongda had woven a huge trade network in many places in Southeast Asia and Black Africa.
It achieved a near-seamless exchange between upstream raw materials and mass industrial products, promoting Dongda's industry to continuously move towards the direction of a world factory. In trade with the West, Dongda mainly focused on automobiles, aviation, and electronic computer products because these products were either their hard-to-replace advantageous products, such as large aircraft and computers, or high-quality products with low prices and excellent quality, such as automobiles. Mid-to-low-end cars mainly based on Golf, JETTA, and Polo had already entered their daily lives, becoming the mainstream varieties of mid-to-low-end cars in Europe and the United States.
In this wave of competition with European and American industrial capital, Dongda began to gain a competitive advantage through system advantages! The world ranking of total foreign trade sales was climbing almost every year, and it has now entered the top five industries, completely shaking off the impression of a poor agricultural country and becoming a newly emerging industrial power.