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Yongye Nongfeng Signs Agreement to Secure Coal Resources Project in Inner Mongolia, PRC

March 12, 2010

BEIJING, March 12 /PRNewswire-Asia-FirstCall/ — Yongye International, Inc.
(Nasdaq: YONG), (“Yongye or “the Company”) a leading developer, manufacturer,
and distributor of Shengmingsu brand plant and animal nutrient products in the
People’s Republic of China
(PRC), today announced its operating entity in
China, Yongye Nongfeng Biotechnology, signed a preliminary agreement with a
local supplier of humic acid to purchase an undeveloped lignite coal resources
project in Inner Mongolia, PRC. Consummation of the acquisition requires the
satisfaction of certain customary closing conditions, including receipt of
governmental approval. Yongye Nongfeng is seeking to meet these requirements
and complete the transfer as quickly as practicable.

The preliminary agreement with Wuchuan Shuntong Humic Acid Trading Company
Limited (“Shuntong”) provides for the acquisition of Shuntong’s development
rights to a currently undeveloped lignite coal resource project located in
Wuchuan County, a suburb located outside the city of Hohhot, Inner Mongolia,
where the company’s major operations reside in the PRC. According to a third
party valuation report, the project area is estimated to contain over 40
million square meters of surface level lignite coal which can supply the
company’s long term needs. According to the agreement, Nongfeng will pay
Shuntong RMB240 million ($35.1 million) to acquire the development rights for
this project. In addition to this, Nongfeng plans to build a new factory with
20,000 tons of plant nutrient product and 10,000 tons animal nutrient product
annual capacity in a nearby economic development zone located near the coal
resources project. According to government regulations, the acquisition will
not be completed until Nongfeng makes full payment to Shuntong and receives in
return the full, unencumbered title to the development rights.

“Acquiring this lignite coal resource is of great strategic importance to
us and is in line with our overall plan. In our operations, humic Acid, which
is extracted from lignite coal, is the most significant cost component and it
is important to secure this lignite coal resource at a cost effective price.
Once this acquisition is complete, Yongye’s fast growing Shengmingsu business
won’t be subject to market price fluctuation of this key raw material,” said
Mr. Zishen Wu, Chief Executive Officer. “Once our new factory becomes fully
operational, we expect higher gross margin due to the benefit of this vertical
integration.”

Yongye also plans to build a new manufacturing facility in an economic
development zone which is in close proximity to the Lignite Coal Project. This
new factory is expected to be capable of extracting humic acid from lignite
coal and producing 20,000 tons per year of the Company’s liquid plant product
and 10,000 tons per year of its powder animal product.

Mr. Wu added, “Our current manufacturing facility operates at almost full
capacity to meet peak season demand and inventory requirements. Our new
factory will therefore help us continue to grow our business to meet the
strong demand for our product in the domestic agricultural market in China. In
addition, we believe that our new factory, once complete, will lead to
significant cost savings by more tightly integrating the production of humic
acid with our fulvic acid extraction process. We expect higher gross margins
and increased profitability due to the benefits from this vertical
integration.”

About Yongye International, Inc.

Yongye International, Inc., headquartered in Beijing, is engaged in the
development, manufacturing, distribution and sales of Shengmingsu brand plant
and animal nutrient products. The Company’s patented and patent pending
formulas and proprietary extraction processes allow it to create products that
increase crop yields and improve the health of livestock. Its sole operating
subsidiary, Inner Mongolia Yongye Nongfeng Biotechnology Co., Ltd., is
headquartered in Beijing with major operations located in Inner Mongolia,
People’s Republic of China. For more information, please visit the Company’s
website at http://www.yongyeintl.com .

Safe Harbor Statement

This press release contains certain statements that may include
“forward-looking statements.” All statements other than statements of
historical fact included herein are “forward-looking statements.” These
forward-looking statements are often identified by the use of forward-looking
terminology such as “believes,” “expects” or similar expressions, involving
known and unknown risks and uncertainties. Although the Company believes that
the expectations reflected in these forward-looking statements are reasonable,
they do involve assumptions, risks and uncertainties, and these expectations
may prove to be incorrect. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this press
release. The Company’s actual results could differ materially from those
anticipated in these forward-looking statements as a result of a variety of
factors, including the risk factors discussed in the Company’s periodic
reports that are filed with the Securities and Exchange Commission and
available on the SEC’s website (http://www.sec.gov ). All forward-looking
statements attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these risk factors. Other than as
required under the securities laws, the Company does not assume a duty to
update these forward-looking statements.

    For further information, please contact:

    Yongye International, Inc.
     Mr. Larry Gilmore-VP of Corporate Strategy
     Phone: +86-10-8232-8866 x 8880
     Email: larry.gilmore@yongyeintl.com
     Web:   http://www.yongyeintl.com

    CCG Investor Relations, Inc.
     Mr. Crocker Coulson, President
     Phone: +1-646-213-1915 (New York)
     Email: crocker.coulson@ccgir.com

     Athan Dounis, Account Manager
     Phone: +1-646-213-1916
     Email: athan.dounis@ccgir.com
     Web:   http://www.ccgirasia.com

SOURCE Yongye International, Inc.


Source: newswire