Black Earth Farming operates small-scale production of meat and milk in the Ryazan, Kaluga and Lipetsk Oblasts. The Company may amplify the magnitude of the meat and milk production to diversify its operations and thereby reduce its business risk. Cash flows generated from milk and meat are continuous as opposed to cash flows from crops.

Dairy farming and meat production will also reduce the Company’s exposure to adverse weather conditions. Moreover, there are synergistic potentials in the agricultural operations since manure is a beneficial fertilizer and any marginal land not optimal for crop farming may be used as grazing grounds for cattle.