You say, "Eek, it's a Chinese company!" I say, "So what?"

Yongye International (Nasdaq: YONG) might have been beaten up black and blue by the "anti-Chinese" short-sellers, but I almost fell off my chair after seeing its third-quarter numbers. With revenues almost doubling and profits rising even more than that, you cannot let this company pass by without taking a good look.

Yongye rocks!
Thanks to aggressive marketing efforts, Yongye's revenue shot up by a staggering 95.9% from the year-ago quarter to $140.6 million. Almost 21% of the total sales came from new provincial markets that Yongye had been tapping for some months now. These promotional initiatives led to a whopping 64.1% jump to $25.6 million in Yongye's selling expenses.

Good marketing is definitely key to higher revenue, and fertilizer companies seem to have understood this well. Not just Yongye, but rival China Green Agriculture (NYSE: CGA) also sold more of its humic-acid-based compound fertilizers in its first quarter as marketing efforts paid off.

Because of the solid top-line growth, Yongye's net income jumped to $39.1 million from $17.6 million a year ago.

Smart moves
While Yongye's focus on expanding its product reach is noteworthy, what impresses me more is its smart strategy of putting in the money where it pinches most -- sourcing raw materials. Instead of buying humic acid from intermediaries, the company is now using lignite coal from its own Wuchuan facility to extract its nutrients. In fact, since this facility became operational last year, Yongye has already started seeing a decrease in its costs.

Moreover, during its third quarter, Yongye also received government approval for a mineral resource exploration permit for its designated project site in Wuchuan, which is very close to its primary production facility. This seems to be a significant step toward the development of the site as a primary source of raw material for Yongye's nutrient products and should result in significant cost advantages in the future.

In Yongye's favor
What should add to Yongye's efforts are the favorable industry conditions. Across the board, fertilizer companies have been happily cashing in on the global agricultural boom. PotashCorp's (NYSE: POT) third-quarter revenue, for instance, grew an astounding 47% from the year-ago period to $2.3 billion as emerging markets drove demand.

Likewise, Terra Nitrogen (NYSE: TNH) and CVR Partners (NYSE: UAN) also reported solid revenue growth of 49% and 66.4% in their respective third quarters, thanks to rising crop prices and strong market conditions fueling prices of nutrients. And this agriculture boom is likely to stay for some time to come.

Yongye's base in China is an added plus here. China's burgeoning population, higher spending power, and increased consumption are fueling the demand for food, lifting agriculture production. This translates into higher demand for fertilizers, which is where Yongye's branded fertilizers fit in well.

The Foolish bottom line
Yongye seems to be growing much faster than the market gives it credit for. Also, there is evidence that discourages us from looking at it with a suspicious eye.

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