Sunrise Group, a Major Financing Soybean Importer Went Bankrupt

By CnAgri2018-08-08 16:03:11 Print On July 16, 2018, Sunrise Group applied for bankruptcy reorganization because it was unable to pay off its debts due to the lack of solvency. The group is mainly engaged in the business of petrochemical, grain and oil processing, international trade and cultural tourism. The total sales revenue of the group reached RMB 43.2 billion in 2016, of which the total output value of grain and oil processing was RMB 1.59 billion.
 
Shandong is the main area of soybean crushing in China and also the most concentrated area of financing soybean import. Sunrise Group imported 8.52 million tons of soybeans in 2014, accounting for 12% of the total imports of China, but affected by the difficulty of financing and the increase of supervision, the soybean imports dropped to 2.87 million tons in 2015 and fell to 1.9 million tons in 2016, accounting for only 2%. As early as in 2016, Shandong Rizhao Changhua Group (a main financing soybean importer) also declared bankruptcy because of the capital chain rupture.
 
This is mainly due to the fact that the over capacity of soybean crushing is serious in China, and the enterprises can only guarantee their market position by guaranteeing the high rate of operation. Sunrise Group mainly focused on soybean trade but its production and sales did not have competitive advantages. Along with the continued depreciation of the RMB and the strengthening of the government's management of financing soybeans, the group’s soybean business had been severely hindered and its capital situation was unfavorable until it faced bankruptcy.