10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

(Mark One)

ý            Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2008

or

¨            Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ____________ to ___________.

Commission File Number 000-51200

Yongye International, Inc.

(Exact Name of Small Business Issuer as Specified in Its Charter)

Nevada	20-8051010
(State or other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

6th Floor, Suite 608, Xue Yuan International Tower,No.

1 Zhichun Road, Haidian District Beijing, PRC

(Address of Principal Executive Office)

(Former address of Principal Executive Office, if changed since last report)

+86 10 8232 8866

(Issuer’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ¨(Do not check if a smaller reporting company)	Smaller reporting company ý

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No ý

As of August 14 , 2008, 20,000,374 shares of common stock, par value $.001 per share, were issued and outstanding.

EXPLANATORY NOTE

We are filing this Quarterly Report on Form 10-Q/A (the “Amendment”) to amend Part I, Item 1, Financial Statements and Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in the original Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission (“SEC”). This Amendment has been filed to correct an error in the manner in which we calculated the number of shares outstanding in determining earnings per share, and another error in which we should have reclassified warrants issued as a derivative liability, and the financial statements contained herein are being restated accordingly. In addition, certain revisions are being made to the disclosure included in our Form 10-Q for the quarter ended June 30, 2008 initially filed with the Securities and Exchange Commission (the “Commission”) on August 15, 2008 in response to the Commission’s comment letter dated September 1, 2009.

	Page
Part I: Financial Information:
Item 1 -Financial Statements (Unaudited):		3
Consolidated Balance Sheets		3
Consolidated Statements of Operations and Comprehensive Income		4
Consolidated Statements of Cash Flows		5
Notes to Consolidated Financial Statements		6
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
Signatures		26

2

Item 1- Financial Statements

YONGYE INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	Yongye
	International, Inc.
	and Subsidiaries
	(f/k/a Yongye Biotechnology International, Inc.)		The predecessor Inner Mongolia Yongye
	JUNE 30, 2008		DECEMBER 31, 2007
	(Unaudited)
CURRENT ASSETS
Cash and cash equivalents	$	1,350,330	$	376,002
Accounts receivable		20,613,347		1,630,609
Inventory		5,196,266		9,851,788
Advance payments		65,453		—
Due from affiliates		—		978,384
Other receivables		216,795		27,038
Total Current Assets		27,442,191		12,863,821
PROPERTY AND EQUIPMENT, NET		551,545		2,486,487
INTANGIBLE ASSETS, NET		117,610		3,665,584
LONG-TERM INVESTMENTS		—		4,115,764
TOTAL ASSETS	$	28,111,346	$	23,131,656
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	1,882,643	$	1,271,852
Accounts payable		4,889,694		—
Short-term bank loan		—		5,484,000
Due to shareholders		—		2,507,371
Due to related parties		2,411,105		—
Tax payables		406,530		893,892
Other payables		40,424		50,916
Derivative liabilities – fair value of warrants		4,578,517		—
Total Current Liabilities		14,208,913		10,208,031
LONG-TERM SHAREHOLDER LOANS		—		12,153
Minority interest		1,135,005		—
STOCKHOLDERS' EQUITY
Capital stock; 20,000,374 shares authorized and issued par value $.001 on June 30, 2008		20,000		—
Capital contribution		—		7,260,000
Additional paid-in capital		6,775,898		—
Retained earnings		4,785,652		4,024,111
Statutory reserve		771,107		480,629
Accumulated other comprehensive income		414,771		1,146,732
Total Stockholders’ Equity		12,767,428		12,911,472
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	28,111,346	$	23,131,656

3

YONGYE INTERNATIONAL, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

	Yongye International, Inc.
	and Subsidiaries
	(f/k/a Yongye Biotechnology International, Inc.)			The predecessor Inner Mongolia Yongye			Yongye International, Inc. and Subsidiaries			The predecessor Inner Mongolia Yongye
	FOR THREE MONTHS ENDED			FOR THREE MONTHS ENDED			FOR SIX MONTHS ENDED			FOR SIX MONTHS ENDED
	JUNE 30, 2008			JUNE 30, 2007			JUNE 30, 2008			JUNE 30, 2007
	(Restated - Note 1(C))						(Restated - Note 1(C))
SALES	$	17,598,671		$	7,441,212		$	26,986,639		$	8,127,718
COST		7,996,521			3,908,020			12,419,020			4,346,761
GROSS PROFIT		9,602,150			3,533,192			14,567,619			3,780,957
SELLING EXPENSES		777,012			62,135			3,997,477			71,193
GENERAL AND ADMINISTRATIVE EXPENSES		454,697			108,350			812,125			154,986
INCOME FROM OPERATIONS		8,370,441			3,362,707			9,758,017			3,554,778
OTHER INCOME/(EXPENSES)
Interest income		789			1,278			778			1,291
Other expense		(387,198	)		(51,191	)		(386,840	)		(197,641	)
Change in fair value of derivative liabilities		(2,154,323	)		—			(2,154,323	)		—
TOTAL OTHER EXPENSES, NET		(2,540,732	)		(49,913	)		(2,540,385	)		(196,350	)
INCOME BEFORE PROVISION FOR INCOME TAXES		5,829,709			3,312,794			7,217,632			3,358,428
PROVISION FOR INCOME TAXES		219,983			—			594,765			—
NET INCOME BEFORE MINORITY INTEREST		5,609,726			3,312,794			6,622,867			3,358,428
PROVISION FOR MINORITY INTEREST		603,194			—			1,035,005			—
NET INCOME		5,006,532			3,312,794			5,587,862			3,358,428
Foreign Currency Translation Adjustment		277,101			127,723			414,771			174,195
COMPREHENSIVE INCOME	$	5,283,633		$	3,440,517		$	6,002,633		$	3,532,623
Net income per share:
Basic		0.27		N.A.				0.37		N.A.
Diluted		0.27		N.A.				0.37		N.A.
Weighted average shares used in computation:
Basic		18,496,093		N.A.				14,970,434		N.A.
Diluted		18,496,093		N.A.				14,970,434		N.A.

The accompanying notes are an integral part of these consolidated financial statements.

4

YONGYE INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Yongye
	International, Inc. and Subsidiaries (f/k/a Yongye Biotechnology
	International,			The predecessor
	Inc.)			Inner Mongolia Yongye
	FOR SIX			FOR SIX
	MONTHS			MONTHS
	ENDED			ENDED
	JUNE 30,			JUNE 30,
	2008			2007
	(Unaudited)			(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,587,862		$	3,358,428
Adjustments to reconcile net income to net cash used in operating activities
Depreciation and amortization		93,263			10,644
Loss on disposal of fixed assets		—			146,714
Change in fair value of derivative liabilities		2,154,323			—
Provision for minority interest		1,035,005			—
Changes in assets and liabilities:
Accounts receivable, net		(20,613,347	)		(6,557,611	)
Inventories		(5,196,266	)		(319,604	)
Other receivables, net		(216,795	)		(1,063,081	)
Advances to suppliers		(65,453	)		352,866
Prepaid expense		—			(7,271	)
Accounts payable and accrued expenses		6,772,337			288,578
Tax payable		406,530			49,894
Due to related parties		2,397,465			838,369
Other payables		40,424			(1,759,915	)
Net Cash Used in Operating Activities		(7,604,652	)		(4,661,989	)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment		(639,519	)		(22,380	)
Additions to intangible assets		(122,899	)		—
Net Cash Used in Investing Activities		(762,418	)		(22,380	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term bank loans		—			4,269,087
Proceeds from share capital		10,100,651			—
Proceeds from shareholder loans		—			1,413,004
Repayment of long-term loans		—			(6,500	)
Payment for stock issuance costs		(806,159	)		—
Net Cash From Financing Activities		9,294,492			5,675,591
EFFECT OF FOREIGN CURRENCY TRANSLATION ON CASH		414,771			21,787
NET INCREASE IN CASH AND CASH EQUIVALENTS		1,342,193			1,013,009
CASH AND CASH EQUIVALENTS - BEGINNING		8,137			89,023
CASH AND CASH EQUIVALENTS - ENDING	$	1,350,330		$	1,102,032
Supplemental cash flow information:
Cash paid for income taxes		417,744			—
Cash paid for interest expense payment		—			50,920

The accompanying notes are an integral part of these consolidated financial statements.

5

YONGYE INTERNATIONAL, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2008

NOTE 1 - -ORGANIZATION AND DESCRIPTION OF BUSINESS

A. Organization

 Yongye International, Inc. (the “Company”, formerly known as “Golden Tan, Inc.” or “Yongye Biotechnology International, Inc.”) was incorporated in the State of Nevada on December 12, 2006. On April 17, 2008, the Company entered into a share exchange agreement (the “Exchange Agreement”) with Fullmax Pacific Limited, a privately held investment holding company organized on May 23, 2007 under the laws of the British Virgin Islands (“Fullmax”) and the shareholders of Fullmax (the “ Fullmax Shareholders”), who collectively owned all the issued and outstanding ordinary shares of Fullmax. Pursuant to the terms of the Exchange Agreement, the Fullmax Shareholders transferred to the Company all of their shares in exchange for 11,444,755 (the “Shares”) shares of the Company’s common shares (the “Share Exchange”). As a result of the Share Exchange, Fullmax became a wholly-owned subsidiary of the Company and the Fullmax Shareholders received approximately 84.7% of the Company’s issued and outstanding common shares. Immediately prior to the date of the Share Exchange, the Company was a publicly listed shell entity with no operations and had a nominal amount of cash and, Fullmax, through its wholly-owned subsidiary, Asia Standard Oil Limited (“ASO”) and indirect subsidiary, Yongye Nongfeng Biotechnology (“Yongye Nongfeng”), was engaged in the sale of fulvic acid based liquid and powder nutrient compounds for plant and animal feed used in the agriculture industry. The Share Exchange was accounted for as a reverse recapitalization, equivalent to the issuance of stock by Fullmax for the net monetary assets of the Company accompanied by a recapitalization.

In November 2007, ASO a Hong Kong investment holding company, entered into a Sino-Foreign cooperative joint venture contract (“Contract”) with Inner Mongolia Yongye Biotechnology Co., Ltd. (“Inner Mongolia Yongye”) to form a cooperative joint venture, Yongye Nongfeng Biotechnology Co. Ltd (“Yongye Nongfeng”), pursuant to which, Inner Mongolia Yongye and ASO is to own 10% and 90% of the equity interests in Yongye Nongfeng, respectively. Inner Mongolia Yongye was formed on September 16, 2003 in the People’s Republic of China (the “PRC”). Mr. Zishen Wu, Chief Executive Officer, President and Chairman of the Company, owns a controlling 91.67% of the equity interest in Inner Mongolia Yongye. Inner Mongolia Yongye’s primary business is the research, manufacturing, and sale of biochemical products for use in plants and animal growth.  Inner Mongolia Yongye is located in the City of Hohhot, Inner Mongolia Autonomous Region PRC.

On January 4, 2008, the incorporation and establishment of Yongye Nongfeng was approved by the Inner Mongolia Department of Commerce and the Inner Mongolia Administration for Industry and Commerce. The scope of business of Yongye Nongfeng is the distribution and sale of products of Inner Mongolia Yongye.  The period of the cooperative joint venture is ten years and may be extended by a written application submitted to the relevant government authority for approval no less than six months prior to the expiration of the cooperative joint venture. Prior to the legal establishment of Yongye Nongfeng, both Fullmax and ASO were non substantive holding companies with no assets and operations and were primarily designed and used as legal vehicles to facilitate foreign participation in the business conducted by Inner Mongolia Yongye.

In May 2008, upon the agreement among Inner Mongolia Yongye, ASO and Yongye Nongfeng, the ownership of Yongye Nongfeng was revised, pursuant to which Inner Mongolia Yongye and ASO became 0.5% and 99.5% equity interest owners of Yongye Nongfeng, respectively. ASO has not fully injected its share of the capital into Yongye Nongfeng and is not required to do so until 2 years after the establishment of the CJV. Based upon actual capital injection into Yongye Nongfeng, Inner Mongolia Yongye and ASO were 1.15% and 98.85% owners, respectively, of Yongye Nongfeng as of June 30, 2008.

B. Nature of Business

The Company, through its primary operating subsidiary, Yongye Nongfeng, is engaged in the sale of fulvic acid based liquid and powder nutrient compounds used in the agriculture industry in the PRC. In January 2008, upon receiving governmental approval of the establishment of Yongye Nongfeng, the management of Yongye Nongfeng anticipated that Yongye Nongfeng would not be able to obtain the fertilizer licensee in the near future, and therefore, Yongye Nongfeng entered into an agreement ( the “Agreement”) with Inner Mongolia Yongye, pursuant to which Yongye Nongfeng agreed to purchase finished goods products that are to be manufactured by Inner Mongolia Yongye at a fixed price of RMB 350 per case for fulvic acid plant based products and RMB 120 per case for fulvic acid animal based products .  The term of the Agreement is for the period from January 15, 2008 to January 14, 2013. Pursuant to the Agreement, the Company can terminate this by giving one month notice to Inner Mongolia Yongye. The Company is in the process of terminating the Agreement after obtaining the fertilizer license referred to in the following paragraph.

6

C. Restatement of 2008 Financial Statements

Subsequent to the preparation of the Company’s interim consolidated financial statements as of and for the three and six months ended June 30, 2008, management identified an error in the Company’s basic and diluted net income per share presented in its previously issued consolidated financial statements. The Company incorrectly accounted for the April Escrow Shares (See Note 8) as contingently issuable shares for purposes of calculating earnings per share and excluded such outstanding shares that were placed in escrow from the calculation of the weighted average number of common shares outstanding. It was determined that since April Escrow Shares and September Escrow Shares are neither contingently cancellable nor contingently returnable to the Company, the shares should have been included in the denominator in computing the Company’s basic and diluted net income per share.

In connection with the April Offering (see Note 8), the Company issued the “April Warrants” to certain investors and Roth Capital Partners LLC (“Roth”). According to the terms of these warrants, the Company could be required to pay cash to the warrant holders under certain events that are not within the control of the Company. Specifically, upon the occurrence of certain “fundamental transactions” as defined, the warrant holders (but not the shareholders of the Company’s common stock) are entitled to receive cash equal to the value of the warrants to be determined based on an option pricing model and certain specified assumptions set forth in the warrant agreement. In accordance with Emerging Issues Task Force Issue (EITF) No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock,

such potential cash payments that are not within the Company’s control would preclude equity classification and therefore the warrants should have been classified as a liability and adjusted to fair value through earnings at each reporting dates starting from the issuance date.

During the six months ended June 30, 2008, the Company issued the “April Warrants” and “Roth April Warrants. The terms of these warrants provide “Fundamental Transaction” in which net cash settlement could occur under some circumstance that is not within the company’s control (see Note 8).  Upon the adoption of EITF Issue No. 00-19, April Warrants have been classified as a liability with fair value at issuance date and would be adjusted to fair value through earnings at each reporting dates starting from the issuance date.

As a result, the amount of $1,731,567 should have been recognized as derivative liabilities with fair value at issuance. The increase in fair value of the warrants of $1,538,802 should have been recorded as a charge to earnings for the three months and six months ended June 30, 2008.  In addition, since the Roth Warrants issued by the Company in April 2008 (see Note 8) also contains the “Fundamental Transactions”, such warrants should have been accounted for as a liability with changes in fair value also reported in earnings.  Accordingly, the increase in fair value of the Roth April Warrants from the date of issuance through June 30, 2008 of $615,521 should have been recorded as a charge to earnings for the three and six months ended June 30, 2008. These restatement adjustments had no impact on the Company’s previously reported income tax amounts because the profit or loss associated with these warrants for financial reporting purposes, as described herein, are not expected to result in future income tax consequences.

The following table presents the effect of correcting this error on the consolidated financial statements for the three months and six months ended June 30, 2008. As the correcting adjustments had no impact on the amounts previously reported for the Company’s operating, investing or financing cash flows, the adjustments to the components of consolidated cash flow statement to reconcile net income to net cash used by operating activities are not presented.

CONSOLIDATED BALANCE SHEET

	June 30, 2008
	As Previously Reported		As Restated
Derivative liabilities		—		4,578,517
Total current liabilities		9,630,396		14,208,913
Additional paid-in capital		9,200,092		6,775,898
Retained earnings		6,939,975		4,785,652
Total Stockholders' Equity		17,345,945		12,767,428

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

	Three months ended June 30, 2008						Six months ended June 30, 2008
	As Previously			As Restated			As Previously			As Restated
Change in fair value of derivative liabilities		—			(2,154,323	)		—			(2,154,323	)
Total other expenses, net		(386,409	)		(2,540,732	)		(386,062	)		(2,540,385	)
Income before provisions for income taxes and minority interest		7,984,032			5,829,709			9,371,955			7,217,632
Net income before minority interest		7,764,049			5,609,726			8,777,190			6,622,867
Net income		7,160,855			5,006,532			7,742,185			5,587,862
Comprehensive income		7,437,956			5,283,632			8,156,956			6,002,632
Net income per ordinary share-basic	$	0.43		$	0.27		$	0.55		$	0.37
Net income per ordinary share-diluted	$	0.41		$	0.27		$	0.54		$	0.37
Weighted average ordinary shares outstanding		16,847,741			18,496,093			14,146,258			14,970,434
Weighted average ordinary shares outstanding used in computing diluted net income per ordinary share.		17,435,896			18,496,093			14,265,199			14,970,434

7

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six months ended June 30, 2008
	As Previously Reported		As Restated
NET INCOME		7,742,185		5,587,862
Change in fair value of derivative liabilities		—		2,154,323

NOTE 2 - -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION

The accompanying consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and include the financial statements of the Company and its majority-owned subsidiaries. All significant intercompany transactions and balances are eliminated on consolidation.

The accompanying unaudited consolidated financial statements as of June 30, 2008 and for the three and six months ended June 30, 2008 and 2007 have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Regulation S-X applicable to small business issuers. In the opinion of management, these unaudited consolidated interim financial statements include all adjustments considered necessary to make the financial statements not misleading. The results of operations for the three and six months ended June 30, 2008 are not necessarily indicative of the results for the full fiscal year ending December 31, 2008. The unaudited consolidated interim financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto for the year ended December 31, 2007 as reported in Form S-1.

USE OF ESTIMATES

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS

In accordance with Statement of Financial Accounting Standards No. 95, “Statement of Cash Flows,” the Company and the Predecessor considers all highly liquid instruments with original maturities of three months or less to be cash and cash equivalents.

8

ACCOUNTS RECEIVABLE AND BAD DEBT RESERVE

The Company performs certain credit evaluation procedures and does not require collateral for financial instruments subject to credit risk. The Company believes that credit risk is limited because the Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk of its customers, establishes an allowance for uncollectible accounts receivable. As a consequence, the Company believes that its accounts receivable credit risk exposure beyond such allowances is limited. The Company recognizes an allowance for doubtful accounts to ensure accounts receivable are not overstated due to uncollectability and are maintained for all customers based on a variety of factors, including the length of time the receivables are past due, significant one-time events and historical experience. Based on the age of the receivables, the Company reserves 10% of accounts receivable balances that have been outstanding for more than 6 months but less than one year, 20% of accounts receivable balances that have been outstanding between one year and two years, 50% of receivable balances that have been outstanding between two year and three years, and 100% of receivable balances that have been outstanding for more than three years. An additional reserve for individual accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case of bankruptcy filings or deterioration in the customer’s operating results or financial position. If circumstances related to customers change, estimates of the recoverability of receivables would be further adjusted . No allowance for doubtful accounts was provided as of June 30, 2008.

Our normal credit terms to our major customers are typically 90 days, while we ask our other customers to pay either up front or upon receipt. We based the CJV’s Accounts Receivable and Bad Debt Reserve policy on the historical experience of the Predecessor company’s sale and collection rates for the same products.

9

INVENTORY

Inventory is stated at the lower of weighted average cost or market, which takes into account historical prices on a continuing basis, or market.

PROPERTY AND EQUIPMENT

Property and equipment other than leasehold improvements are stated at cost and depreciated using the straight-line method, over the estimated useful lives of the assets. Leasehold improvements are stated at cost and depreciated using the straight-line method over the estimated useful life or lease period, whichever is shorter. Estimated useful lives are as follows:

Estimated Useful Life

Yongye International, Inc.
Office equipment and furniture	5 years
Leasehold improvements	15 months
The Predecessor- Inner Mongolia Yongye
Buildings	50 years
Machinery and equipment	10-20 years
Transportation equipment	10 years

REVENUE RECOGNITION

Our distributors are classified as our customers. Revenue from product sales is recognized when title has been transferred, which is generally at the time of customer’s receipt of product, the risks and rewards of ownership have been transferred to the customer, the fee is fixed and determinable, and the collection of the related receivable is probable. The Company reports revenue net of value added taxes if applicable.

If the product is has expired or the package is broken at the time of receipt, the distributor has the right to exchange it for a new product with intact package; and distributors do not have the right to return unused, intact product to us after it has been delivered.

ADVERTISING COSTS

Advertising costs are expensed as incurred. Advertising costs for three months ended June 30, 2008 and 2007 were $480,457 and $4,738, respectively. Advertising costs for the six months ended June 30, 2008 and 2007 were $2,057,032 and $8,594, respectively.

IMPAIRMENT OF LONG-LIVED ASSETS

The Company follows Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS 144”), which addresses financial accounting and reporting for the impairment or disposal of long-lived assets. Per SFAS 144, the Company is required to periodically evaluate the carrying value of long-lived assets and to record an impairment loss when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the asset’s carrying amounts.

In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the long-lived assets. Loss on long-lived assets to be disposed of is determined in a similar manner, except that fair market values are reduced for the cost of disposal. Based on its review, the Company and the Predecessor concluded that as of June 30, 2008 and December 31, 2007 there were no significant impairments of its long-lived assets.

INCOME TAXES

Deferred income taxes are computed using the asset and liability method, such that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between financial reporting amounts and the tax basis of existing assets and liabilities based on currently enacted tax laws and tax rates in effect in the People’s Republic of China for the periods in which the differences are expected to reverse. Income tax expense is the tax payable for the period plus the change during the period in deferred income taxes.

10

A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. No differences were noted between the book and tax bases of the Company and the Predecessor’s assets and liabilities, respectively, therefore, there are no deferred tax assets or liabilities for the three months period ended June 30, 2008 and 2007 and the six months period ended June 30, 2008 and 2007. The Company’s Cooperative Joint Venture subsidiary Yongye Nongfeng Biotechnology Co., (“Yongye Nongfeng”) is subject to PRC Enterprise Income Tax at a rate of 25% of net income from its foundation on January 4, 2008, and 1.25% of gross revenue since April 2008. Since the Predecessor is located in the economic development area in Inner Mongolia Autonomous Region, the Predecessor is exempt from income tax according to the tax law in China.

FOREIGN CURRENCY TRANSLATION AND TRANSACTIONS

The financial position and results of operations of the Company’s Chinese subsidiaries are determined using local currency (Chinese Yuan) as the functional currency, while the reporting currency is US dollar. Assets and liabilities of the subsidiaries are translated at the prevailing exchange rate in effect at each period end. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income statement accounts are translated at the average rate of exchange during the period. Translation adjustments arising from the use of different exchange rates from period to period are included in the cumulative translation adjustment account in shareholders’ equity. Gains and losses resulting from foreign currency transactions denominated in other than the functional current are included in operations as incurred. Such gains and losses were immaterial for the periods ended June 30, 2008 and 2007.

In the opinion of management, these unaudited interim financial statements include all adjustments and disclosures considered necessary to a fair statement of the results for the interim periods presented. All adjustments are of a normal recurring nature.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company follows Statement of Financial Accounting Standards ("SFAS") 157, Fair Value Measurements. SFAS 157 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:

Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.

Level 3 - Inputs are unobservable inputs which reflect the reporting entity's own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

The carrying amounts of cash and cash equivalents, term deposits, trade receivables, and accounts payable approximate their fair value due to the short-term nature of these instruments. The Company uses level 2 inputs to value its derivative liabilities.

NET INCOME PER SHARE

Basic net income per share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share reflects the potential dilution that would occur upon the exercise of outstanding warrants at June 30, 2008. The warrants are anti-dilutive for the three and six months ended June 30, 2008 but they and other potential common share equivalents may be dilutive in the future.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In February 2008, the Financial Accounting Standards Board ("FASB") issued FASB Staff Position FAS 157-2, "Effective Date of FASB Statement No. 157 ("FSP FAS 157-2"), which delays the effective date of SFAS 157 for all nonrecurring fair value measurements of nonfinancial assets and liabilities until fiscal years beginning after November 15, 2008. The Company has elected to defer the adoption of the nonrecurring fair value measurement disclosures nonfinancial assets and liabilities. The adoption of FSP FAS 157-2 is not expected to have a material impact on the Company's results of operations, cash flows or financial positions.

NOTE 3-INVENTORY

Inventory at June 30, 2008 and December 31, 2007 consisted of the following:

	Yongye		ThePredecessor
	International,Inc.andSubsidiaries		InnerMongoliaYongye
	JUNE30,2008		DECEMBER31,2007
Raw materials		—		384,361
Packing supplies		—		195,127
Work-in process		—		4,969,350
Finished goods		5,195,760		4,302,950
Consumables		506		—
Total		5,196,266		9,851,788

NOTE 4-DUE FROM AFFILIATES

The balance due from the Predecessor’s affiliated entity, Huimin Biotechnology Co., Ltd., at December 31, 2007 was $978,384. The balance had no stated terms for repayment and was not interest-bearing.

11

NOTE 5-PROPERTY AND EQUIPMENT

Property and equipment at June 30, 2008 and December 31, 2007 consisted of the following:

	Yongye		ThePredecessor
	International,Inc.andSubsidiaries		InnerMongoliaYongye
	JUNE30,2008		DECEMBER31,2007
Buildings		—		1,560,251
Manufacturing equipment		—		788,641
Office equipment and furniture		35,005		33,724
Construction-in-process		386,231		1,797
Vehicles		—		419,529
Leasehold improvement		218,283		—
		639,519		2,803,942
Less: Accumulated depreciation		87,974		317,455
Total		551,545		2,486,487

Depreciation expense for the three months period ended June 30, 2008 and 2007 was $45,190 and $3,927, respectively. Depreciation expense for the six months period ended June 30, 2008 and 2007 was $87,974 and $5,333, respectively.

NOTE 6- INTANGIBLE ASSETS

Net intangible assets at June 30, 2008 and December 31, 2007 were as follows:

	Yongye		ThePredecessor
	International,Inc.andSubsidiaries		InnerMongoliaYongye
	JUNE30,2008		DECEMBER31,2007
Rights to use land		—		4,028,099
Patent		105,787		—
Software		17,112		—
		122,899		4,028,099
Less: accumulated amortization		5,289		362,515
Total		117,610		3,665,584

Product patent was acquired by the Company in March 2008 with an estimated useful life of 10 years. It is amortized using the straight-line method over its useful life commencing on April 1, 2008. Computer software was acquired by the Company in June 2008 with an estimated useful life of 10 years. It is amortized using the straight-line method over its useful life commencing on July 1, 2008. Amortization expense for the three months period ended June 30, 2008 and 2007 amounted to $5,289 and $2,486, respectively. Amortization expense for the six months period ended June 30, 2008 and 2007 amounted to $5,289 and $5,311, respectively. Accumulated amortization at June 30, 2008 and December 31, 2007 was $5,289 and $362,515, respectively.

NOTE 7 - LONG-TERM INVESTMENTS

Long-term investments of the Predecessor as of December 31, 2007 consist of medicinal plants and trees which the Predecessor purchased in conjunction with the right to use land. These medicinal plants and trees are to be used for human medical treatments and the Predecessor intends to sell them in future years as they mature.

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NOTE 8 - CAPITAL STOCK

Capital stock

Concurrent with the “Share Exchange”, the Company entered into a securities purchase agreement on April 17, 2008 with certain investors (the “ April Investors ”) for the sale in a private placement of an aggregate of 6,495,619 shares of the Company’s common stock, par value $0.001 per share (the “ April Investor Shares ”) for aggregate gross proceeds equal to $10,000,651 (the “ April Offering ”).

Warrants

Concurrent with the “April Investor Shares”, the Company issued 1,623,905 warrants to purchase 1,623,905 shares of the Company’s common stock (the “ April Warrants ”) to the “April Investors”. The warrants issued have a 5 years exercise period with an exercise price of $1.848. In addition, 649,562 warrants were issued to Roth Capital Partners LLC (“Roth”) as the placement agent with terms and exercise price identical to the warrants issued to the April Investors.

At June 30, 2008, there are 2,273,467 warrants outstanding with a weighted average exercise price of $1.848.  Of this total, 2,273,467 expire in April 2013.

Pursuant to these warrant agreements, in the event of a “Fundamental Transaction” that is (1) an all cash transaction, (2) a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the Exchange Act, or (3) a Fundamental Transaction involving a person or entity not traded on a national securities exchange, the Nasdaq Global Select Market, the Nasdaq Global Market, or the Nasdaq Capital Market, the Company or any successor entity shall pay at the warrants holders’ option, exercisable at any time concurrently with or within 30 days after the consummation of the Fundamental Transaction, an amount of cash equal to the value of this Warrant .

As of June 30, 2008 the fair value of all of our derivative liability warrants was $4,578,519. The change in their fair values during the three and six months ended June 30, 2008 of $2,154,323 in fair value is reported as a non-cash charge in our condensed consolidated statement of income and comprehensive income, respectively.

The estimated fair values of the Company’s Investor Warrants and Roth Warrants was determined at June 30, 2008 using Binominal Option Pricing Model with Level 2 inputs.

The following table sets forth, by level within the fair value hierarchy, the Company’s financial liabilities that were accounted for at fair value as of June 30, 2008.

			Fair Value Measurements Using:
			Quoted Prices in Active Markets for Identical Financial		Significant Other		Significant
	Total		Assets and Liabilities		Observable Inputs		Unobservable Inputs
June 30, 2008			Level 1		Level 2		Level 3
Liabilities at fair value:
Derivative liabilities—warrants		4,578,517		—		4,578,517		—
Net Liabilities	$	4,578,517	$	—	$	4,578,517	$	—

The fair values of the warrants granted are as follows:

Fair value of Warrant per share (US$) at:	2008 April Offering
April 17, 2008	1.07
June 30, 2008	2.01

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The fair values of the warrants as of June 30, 2008 were determined based on the Binominal option pricing model using the following assumptions:

	April Offering
Expected volatility	52.5%
Expected dividends yield	0%
Expected time to maturity	4.8 years
Risk-free interest rate per annum	2.900%
Fair value of underlying Common Shares (per share)	3.50
Exercise multiple	2.4

Escrow shares

In connection with the April Offering, the Company entered into an escrow agreement with Roth as a representative of the April Investors, Tri-State Title & Escrow LLC (the “Escrow Agent”) and  Full Alliance, one of the Company’s shareholders (the “April Escrow Agreement”), pursuant to which 2,000,000 shares of the Company held by Full Alliance (the “April Escrow Shares”) were delivered to the Escrow Agent. The Escrow Shares were held for the Company’s achievement of $10,263,919 after tax net income (“ATNI”) for the year ended December 31, 2008 (the “2008 Net Income Threshold”). As reported in the Company’s 2008 Form 10-K, the ATNI threshold has been achieved.

The purpose of the April Escrow Arrangement was an inducement made to facilitate the respective offerings, and not part of a compensatory arrangement to management. The escrow shares will not be released or cancelled due to the discontinued employment of any management of the Company.

NOTE 9 - RELATED PARTY TRANSACTIONS

The Predecessor company is a 1.15% shareholder of the Company’s main operating subsidiary, Yongye Nongfeng, and is Yongye Nongfeng’s only vendor that provided $8,537,112 (100%) of the Company’s purchased finished goods for the three months period ended June 30, 2008 and $17,468,749 for the six months period ended June 30. As of June 30, 2008 accounts payable to shareholder represents the credit the Company used as of June 30, 2008 in purchasing inventory from the Predecessor. According to the contract, the Predecessor sells to us at fixed prices of RMB 350 per case for plant products and RMB 120 per case for animal products.

As of June 30, 2008, the Company has borrowed $762,524 from Inner Mongolia Yongye Nongfeng’s 1.15% shareholder Inner Mongolia Yongye (the Predecessor), $1,638,581 in loan from Ms. Yin, the wife of CEO Mr. Zishen Wu of Inner Mongolia Yongye Nongfeng, and $10,000 from a director of the Company. These funds are interest free with no specific terms of repayment. As of December 31, 2007, the Predecessor has $2,507,371 in loans from stockholders. These loans are short term in nature, unsecured and non-interest bearing. Also, at December 31, 2007 the Predecessor has $12,153 of long-term, unsecured and non-interest bearing loans from shareholders.

NOTE 10-NET INCOME PER SHARE

The following table sets forth the computation of basic and diluted income per share for the periods indicated:

	Yongye International, Inc. and Subsidiaries		Yongye International, Inc. and Subsidiaries
	(f/k/a Yongye Biotechnology International Inc.)		(f/k/a Yongye Biotechnology International Inc.)
	FOR THREE MONTHS ENDED		FOR SIX MONTHS ENDED
	JUNE 30, 2008		JUNE 30, 2008
	(Restated- Note 1 (C))		(Restated- Note 1 (C))
Numerator used in basic net income per share:
Net income		5,006,532		5,587,862
Shares (denominator):
Weighted average ordinary shares outstanding- basic and diluted		18,496,093		14,970,434
Net income per ordinary share – basic and diluted		0.27		0.37

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NOTE 11 -CONCENTRATIONS AND CREDIT RISKS

Five major customers accounted for 80% and one major customer accounted for 26% of the Company’s net revenue for the three months period ended June 30, 2008. Five major customers accounted for 89% and one major customer accounted for 26% of the Company’s net revenue for the six months period ended June 30, 2008. Five major customers accounted for 98% and one major customer accounted for 51% of the Predecessor’s net revenue for the three months period ended June 30, 2007. Five major customers accounted for 98% and one major customer accounted for 46% of the Predecessor’s net revenue for the six months period ended June 30, 2007. The Company and the Predecessor’s total sales to five major customers were $14,062,646 and $7,276,561, for the three months period ended June 30, 2008 and 2007, respectively. The Company and the Predecessor’s total sales to five major customers were $24,068,529 and $7,961,977, for the six months period ended June 30, 2008 and 2007, respectively.

Yongye International Inc.

Three Months Ended						Six Months Ended
JUNE 30, 2008						JUNE 30, 2008
Largest	Amount of		% Total			Largest	Amount of		% Total
Customers	Sales		Sales			Customers	Sales		Sales
Wuwei Liangzhou	$	4,643,127		26	%	Hebei		7,045,357		26	%
Xinjiang Tianfeng	$	3,980,159		23	%	Xingjiang Bazhou		5,334,140		20	%
Xinjiang Bazhou	$	2,618,526		15	%	Wuwei Liangzhou		4,960,050		18	%
Hebei	$	1,780,598		10	%	Xinjiang Tianfeng		3,922,162		15	%
Bameng	$	1,040,236		6	%	Bameng		2,806,820		10	%
Total	$	14,062,646		80	%	Total		24,068,529		89	%

Inner Mongolia Yongye Predecessor

Inner Mongolia

Yongye

Three Months Ended						Six Months Ended
JUNE 30, 2007						JUNE 30, 2007
Largest	Amount of		% Total			Largest	Amount of		% Total
Customers	Sales		Sales			Customers	Sales		Sales
Xinjiang Bazhou	$	3,797,598		51	%	Xinjiang Bazhou	$	3,777,495		46	%
Hebei	$	1,329,159		18	%	Hebei	$	1,772,318		22	%
Dalian	$	1,082,055		15	%	Dalian	$	1,192,757		15	%
Mengrui	$	689,290		9	%	Mengrui	$	810,609		10	%
Jiangsu	$	378,459		5	%	Jiangsu	$	408,798		5	%
Totals	$	7,276,561		98	%	Totals	$	7,961,977		98	%

The Predecessor is the Company’s only vender who provided 100% of the Company purchased finished goods for the three months period and six months period ended June 30, 2008. The Predecessor had two major vendors who provided 79% and 93% of the Predecessor raw materials for the three months period ended June 30, 2008 and 2007. The Predecessor had two major vendors who provided 76% and 93% of the Predecessor raw materials for the six months period ended June 30, 2008 and 2007. Total purchases from these vendors were $5,822,666 and $2,258,627 for the three months period ended June 30, 2008 and 2007, respectively. Total purchases from these vendors were $6,581,012 and $2,290,895 for the six months period ended June 30, 2008 and 2007, respectively.

15

The Company and the Predecessor’s operations are carried out in the PRC. Accordingly, the Company and the Predecessor’s business, financial condition and results of operations may be influenced by the political, economic and legal environments in the PRC as well as by the general state of the PRC’s economy. The business may be influenced by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

NOTE 12-Commitments

On (June 2, 2008), Yongye Nongfeng signed two construction contracts with two Construction Companies (Hainan No. 4 Construction Engineer Company and Hohhot Saihan District Art & Landscape) to begin construction of a new 8,000 Tons Per Annum (TPA) plant on its current contracted location. The value of these contracts is approximately RMB 25,000,000. This addition, when added to the current 2,000TPA capacity of Inner Mongolia Yongye Biotechnology Company, Ltd., will increase total production capacity to 10,000TPA and is critical to our ability to keep up with future anticipated demand. In July 2008, the construction contractor gave notice that it forecasts the in-service date of the facility to be the endof September 2008, which will be sufficient to avoid any weather-related delays. We do not anticipate any other delays.

Item 2- Management Discussion & Analysis

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements:

The following discussion of the financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes thereto. The following discussion contains forward-looking statements. Yongye International, Inc. (f/k/a Yongye Biotechnology International, Inc.) is referred to herein as “we” or “our.” The words or phrases “would be,” “will allow,” “expect to”, “intends to,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” or similar expressions are intended to identify forward-looking statements. Such statements include those concerning our expected financial performance, our corporate strategy and operational plans. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties, including: (a) those risks and uncertainties related to general economic conditions in China, including regulatory factors that may affect such economic conditions; (b) whether we are able to manage our planned growth efficiently and operate profitable operations, including whether our management will be able to identify, hire, train, retain, motivate and manage required personnel or that management will be able to successfully manage and exploit existing and potential market opportunities; (c) whether we are able to generate sufficient revenues or obtain financing to sustain and grow our operations; and (d) whether we are able to successfullyfulfill our primary requirements for cash which are explained below under “Liquidity and Capital Resources. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.

Restatement of Financial Statements

Due to the complexities of placing the April 2008 Escrow Shares into escrow and subsequently accounting for the performance measures and potential transfer of such shares, the Company believed and accounted for such shares as contingently issuable shares for purposes of calculating earnings per share and excluded such outstanding escrowed shares from the calculation of the weighted average number of common shares outstanding. However, after further examination subsequent to the original filing of our Form 10-Q for the period ended June 30, 2008 and, it was determined that since the April 2008 Escrow Shares are neither contingently cancellable nor contingently returnable to the Company, the shares should have been included in the denominator in computing the Company’s basic and diluted net income per share.

During the six months ended June 30, 2008, the Company issued the “April Warrants” and “Roth April Warrants”. According to the terms of these warrants, the Company could be required to pay cash to the warrant holders under certain events that are not within the control of the Company. Specifically, upon the occurrence of certain “fundamental transactions” as defined, the warrant holders (but not the shareholders of the Company’s common stock) are entitled to receive cash equal to the value of the warrants to be determined based on an option pricing model and certain specified assumptions set forth in the warrant agreement. In accordance with Emerging Issues Task Force Issue (EITF) No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, such potential cash payments that are not within the Company’s control would preclude equity classification and therefore the warrants should have been classified as a liability and adjusted to fair value through earnings at each reporting date starting from the issuance date.

During the six months ended June 30, 2008, the Company issued the “April Warrants” and “Roth April Warrants. The terms of these warrants provide “Fundamental Transaction” in which net cash settlement could occur under some circumstance that is not within the company’s control (see Financial Statements Note 8).  Upon the adoption of EITF Issue No. 00-19, April Warrants have been classified as a liability with fair value at issuance date and would be adjusted to fair value through earnings at each reporting dates starting from the issuance date. $1,731,567 should have been recognized as derivative liabilities with fair value at issuance. The increase in fair value of the warrants of $1,538,802 should have been recorded as a charge to earnings for the three months and six months ended June 30, 2008. In addition, since the Roth May Warrants issued by the Company in April 2008 (see Financial Statements Note 8) also contains the “Fundamental Transactions”, such warrants should have been accounted for as a liability with changes in fair value also reported in earnings. Accordingly, the increase in fair value of the Roth April Warrants from the date of issuance through June 30, 2008 of $615,521 should have been recorded as a charge to earnings for the three and six months ended June 30, 2008. These restatement adjustments had no impact on the Company’s previously reported income tax amounts because the profit or loss associated with these warrants for financial reporting purposes, as described herein, are not expected to result in future income tax consequences.

The correcting adjustments had no impact on the Company’s previously issued consolidated statement of cash flows for the six months ended June 30, 2008.

16

Our Business

We are engaged in the development and distribution of fulvic acid based liquid and powder nutrient compounds used in the agriculture industry. Our headquarters is in Beijing, China and additional administrative offices and our manufacturing unit are located in Hohhot, Inner Mongolia, China. Currently, we sell two lines of products, both based on our fulvic acid compound base: a plant nutrition liquid compound and animal nutrition powder which is a food additive. Our products start with our proprietary fulvic acid base which is extracted from humic acid, and to which we add other natural substances to customize the base for use in our plant and animal product lines. Based on our internal data and research, we believe our proprietary technology for fulvic acid extraction creates some of the purest and most effective fulvic acid base on the market in China today. We have found that our fulvic acid has a very light weight molecular composition, which we believe improves the overall permeability of cell walls and allows more complete transport of nutrients across plant membranes, effectively strengthening the overall health of plants. We believe our proprietary process for extracting fulvic acid from humic acid and our patented process for mixing our plant nutrient and patent pending process for mixing our animal nutrient are key differentiators in the market and may help us provide a high quality product that we can control from procurement of raw materials to final production, which we also believe may help our products to provide reliable and predictable results from season to season.

We are headquartered in Beijing, China and Inner Mongolia Yongye’s manufacturing plant is located in the Inner Mongolia province of China. Currently, we sell two lines of product based on our fulvic acid base: plant nutrition liquid compound and animal nutrition food additive. Our products start with our fulvic Acid base then, in addition, we add other natural substances to customize the base for use in our plant or animal lines of products. Our plant products are intended to add naturally occurring macro and micro nutrients such as nitrogen, phosphorus, potassium, boron and zinc. Our animal products add natural herbs which we believe may help to reduce bacterial inflammation (mastitis) in cows. It also assists many animals to digest food more completely and we thus believe that our animal products may help animals who use them to be healthier.

The financial statements we are reporting for 2007 are for our predecessor company, Inner Mongolia Yongye, which has now transferred all Shengmingsu related 2008 and 2009 sales contracts and income, intellectual property and patents, and personnel, exclusive of manufacturing personnel, into the name of Yongye Nongfeng Biotechnology, the new Cooperative Joint Venture. After this transfer, Inner Mongolia Yongye became the primary contract manufacturing company for the new Cooperative Joint Venture and provided product at a cost plus price for the entire year of 2008. Inner Mongolia Yongye also kept the existing assets and long-term liabilities on its balance sheet.

Overview of 2nd Quarter

Demand for our products

One major tenet of the PRC government’s 11th Five-Year National Economic and Social Plan (the “ NESDP ”) (2006-2010) is the focus towards developing China’s western region.  This is one of the top-five economic priorities of the nation. The goal is to increase rural income growth which will in turn increase demand for more food and agriculture products. Currently, a large majority of our products are sold in this western region and we hope that this government focus will increase our opportunity to sell more plant and animal nutrients to farmers who have to keep up with the demand for higher quantity and higher quality of products.

 Supply of Finished Goods

 Currently, we purchase our finished goods from our main supplier, Inner Mongolia Yongye, and then sell them through our distribution system. In order to generate greater profit margins, we set out to control our cost of goods sold and have put into place a fixed rate contract with our main supplier and this will extend over the next five years. Each quarter we will go through a review process with our supplier to adjust the fixed rate for the next quarter. We have not received any rate increases in the first two quarters in 2008.

 Earthquake in Sichuan

The earthquake in Sichuan was a devastating event in the recent history of China. While the impact was felt all the way to Beijing, the disruption of business and the ensuing relief efforts were largely contained to the province itself and mainly to the areas nearest the epicenter. Because of this, the impact to our business was minimal. China’s Agriculture Minister Sun Zhengcai said in an interview with Xinhua that agriculture production would not be widely changed due to the earthquake in Sichuan primarily because the local output of the impacted area was quite small. He also mentioned that harvesting had been stepped up to ensure food security nationwide.

 Seasonality

We typically face the seasonal demand patterns similar to other companies in our sector. In general, the first and fourth quarters are typically our slowest quarters and in 2008 we brought in approximately 20% and 6% of sales in these quarters. The second and third quarters drive the bulk of our overall sales with 36% and 38% respectively of the year’s net sales. Our Shengmingsu plant line faces the most seasonality of our two product lines with our Shengmingsu for animals experiencing less fluctuation during the year as a result of seasonal buying patterns. This year, while we did experience fluctuations by quarter of our animal line, we believe that this was due more in part to fluctuations in our sales and marketing efforts than due to seasonal buying patterns. We do not expect to face this type of revenue fluctuation for our animal product, which doesn’t typically experience the same seasonal tapering that our plant product faces.

17

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 2008 AND JUNE 30, 2007

We believe that presenting a comparison of the results of our operations to our predecessor helps to provide a meaningful understanding of the underlying business since it enables a comparison of operations periodically. However, due to the transition from the predecessor to the Company that resulted in differences between our current operating model and our predecessor’s, the comparison of our information with the historical information of our predecessor might not be sufficient to be indicative of our future financial position, results of operations or cash flows. In particular, certain assets and liabilities of our predecessor differ significantly from our assets and liabilities.

The approximate 775 retail stores selling Shengmingsu products have been assembled into a network of stores through the work of our distributors. These stores have typically been in existence for many years and sell many other agriculture products including competitive products and we do not receive payment from the owner and they do not pay Yongye Nongfeng any fees or distribute any profits to us. Each distributor works to source successful, independently owned agricultural product stores to bring them into their segment of the branded store network. Our distributors work with the store owner to feature Yongye products in a prominent fashion and will also display brochures and advertisements for our products. Some stores will feature a computer which runs our current infomercials. Before the store is brought into the Branded Store network, it may be selling Yongye products as a “non-branded” store as arranged with our distributors. To become a “branded store” the distributor may require the store to go through a trials process to ensure the store reaches certain performance standards set by the distributor and the distributor will alone determine whether or not the store is considered a branded store. While we work with all of our distributors to standardize this model so that a minimum level of similarity is replicated across all the branded stores, it is implemented by the distributor.

The following table shows, for the periods indicated, information derived from our consolidated statements of income.

	For the three months ended
	Yongye International,						Increase
	Inc.			Predecessor			/(decrease)
	JUNE 30, 2008			Inner Mongolia			(Restated – Financial
	(Restated – Financial			Yongye			Statement Note
	Statement Note 1(C))			JUNE 30, 2007				1(C))
Net Sales	$	17,598,671		$	7,441,212			137	%
Gross Profit	$	9,602,150		$	3,533,192			172	%
Operating Income	$	8,370,441		$	3,362,707			149	%
Net Income	$	5,006,531		$	3,312,794			51	%
Gross Margins		54.56	%		47.48	%		7.08	%
Net Margins		28,45	%		44.52	%		(16.07	)%
EPS- Basic	$	0.27		$	N/A			N/A
EPS- Diluted	$	0.27		$	N/A			N/A

Financial position at quarter ended June 30, 2008 (unaudited) and the year ended December 31,2007:

	Yongye International		Predecessor
	Inc.		Inner Mongolia
	JUNE 30, 2008		Yongye
	(Restated – Financial		DECEMBER 31,		Increase
	Statement Note 1(C))		2007		/(decrease)
Cash	$	1,350,330	$	376,002		259	%
Accounts Receivable, net	$	20,613,347	$	1,630,609		1164	%
PP&E, net	$	551,545	$	2,486,487		(78	)%
Total assets	$	28,111,346	$	23,131,656		22	%
Short-term Bank Loan	$	—	$	5,484,000		(100	)%
Long-term Shareholder Loan	$	—	$	12,153		(100	)%
Total stockholders’ equity	$	12,767,428	$	12,911,472		(1	)%

Our financial condition continues to improve as shown by an increase of 22% in total assets during the second quarter of 2008 increasing by $4,979,690to $28,111,346 at the end of June 30, 2008 from $23,131,656 at the end of December 31, 2007. Cash increased by 259% during the quarter and our accounts receivable increased by 1164% as a result of increased sales volume and longer than anticipated collections on some key accounts. Property, plant and equipment decreased by 78% during the quarter ended June 30, 2008 compared to the prior year end December 31, 2007 because our new business model, after the Reverse Takeover, is as a distribution and sales company and we carved out the 2,000TPA manufacturing facility from our financial structure and it remains with the predecessor company.

18

Sales Revenue and Gross Profit

			Predecessor
			Inner Mongolia
	Yongye Nongfeng		Yongye
	JUNE 30, 2008		JUNE 30, 2007		Increase/
	Unaudited		Unaudited		(Decrease)
Sales	$	17,598,671	$	7,441,212		137	%
Gross Profit	$	9,602,150	$	3,533,192		172	%

Sales revenue for the quarter ended June 30, 2008 was $17,598,671, which was an increase of $10,157,459, or 137%, compared with the corresponding period in 2007. This was also a decrease of 21% from estimated Q2 revenues of $22,205,888 which represents our quarterly seasonal sales estimates of 45% of total 2008 revenue generated in Q2.

Gross profit for the Quarter ending June 30, 2008 was $9,602,150, and represented 55% of sales. This was an increase of $6,068,958, or 172%, when compared with the corresponding period in 2007 which ended at $3,533,192. When compared as a percentage of revenues, Gross Profit Margin increased by 8% from 47% to 55% from 2007 to 2008. The overall increase in margin was largely due to our ability to control Cost of Goods Sold through our contract manufacturing agreement as explained above..

Overall, compared with our results in 2007, we have increased our sales exponentially in Q2 of 2008 and we have already exceeded our expectations in building our network for all of 2008 by increasing the number of branded stores from 350 in Q1 of 2008 to 775 in Q2 of 2008, which is an overall increase of 19% compared to our initial estimation of 650 stores. When looking at the increase from the end of 2007, we have increased stores by 575, which is a 288% increase. Additionally, average same store sales are approximately the same which means our branding process has been successful across the network and is stable. This is due in large part to our efforts to standardize the branding process and provide service and support to all store owners and distributors.

The number of independently owned stores brought into our branded store network grew to 775 in the period ended June 30, 2008 from 200 in the same period ended June 30, 2007, which was an increase of 121%. This was due in large part to continued growth of the distribution network throughout the second quarter of 2008.

Additionally, Yongye Nongfeng was not required to pay VAT for the plant products sold, which increased its gross sales in 2008, whereas Inner Mongolia Yongye paid VAT for all products sold in 2007, which led to an approximate 4% decrease in gross sales. Once the product is recognized by the tax bureau as belonging in the agricultural fertilizer category, it is exempted from VAT taxation for all its future sales. Under the PRC taxation law, our product is categorized as an agricultural fertilizer and as such is exempted from VAT taxation. Our plant product was recognized by the tax bureau as agricultural fertilizer in 2008, so Yongye Nongfeng did not pay VAT for it. We expect this trend will continue as long as Yongye sells plant products.

	End of 2007	End of Q1 2008	End of Q2 2008
Number of Branded Stores	200	350	775
Sales by Product Line:

	Yongye
	International, Inc.
	JUNE 30, 2008
	Units Shipped		% of Total Sales
Plant		159,216		99.96	%
Animals		58		0.04	%
Total		159,274		100.00	%

19

Sales by product and province are listed below:

Province	Animal Product					Plant Product
	Units Shipped		% Shipped			Units Shipped		% Shipped
Gansu		0		0	%		40,010		25	%
Hebei		0		0	%		17,000		11	%
Inner Mongolia		0		0	%		20,500		13	%
Others		58		100	%		10,506		7	%
Shandong		0		0	%		8,200		5	%
Xinjiang		0		0	%		63,000		39	%
Totals		58		100	%		159,216		100	%

We are continuing to expand our markets beyond just our plant product sales as evidenced by the growth of our animal product.

Customers

Our customer base is made up of the distributors working for us in each province; these are not end users of the products. Five major customers accounted for 80% and one major customer accounted for 26% of the Company’s net revenue for the three months period ended June 30, 2008. Five major customers accounted for 98% and one major customer accounted for 51% of the Predecessor’s net revenue for the three months period ended June 30, 2007. The Company and the Predecessor’s total sales to five major customers were $14,062,646and $7,276,561, for the three months period ended June 30, 2008 and 2007, respectively.

Cost of Sales

				Predecessor
	Inner Mongolia			Inner Mongolia
	Yongye			Yongye
	Nongfeng			Biotechnology
	JUNE 30, 2008			JUNE 30, 2007			Change
Cost of Sales	$	7,996,521		$	3,908,020			105	%
Percentage of Sales		45	%		53	%		-8	%

Cost of Sales for the quarter ended June 30, 2008 was $7,996,521, which is 45% of revenues. This is an increase of $4,088,501 over the previous period which represents an 105% increase overall. As a percent of revenue, this represented an overall decrease of 8% when compared with the corresponding period in 2007, which was 53%. The overall dollar increase in cost of sales was primarily due to the increase in our production plan to meet our overall sales goals. The decrease in percentage of cost of sales was due to more stable pricing from our contract manufacturing agreement.

Suppliers

Inner Mongolia Yongye is Yongye Nongfeng’s main contract manufacturer and provided 100% of Yongye Nongfeng’s purchased finished goods for the three months period ended June 30, 2008. We believe this manufacturer will continue to deliver the finished goods we require at the quality levels we expect. Through our contract, we are able to control our prices and Intellectual Property and expect to do so for the foreseeable future.

20

Selling, General and Administrative Expenses

	Inner			Predecessor
	Mongolia			Inner Mongolia
	Yongye			Yongye
	Nongfeng			Biotechnology
	JUNE 30, 2008			JUNE 30, 2007			Change
Selling, General and Administrative Expenses	$	1,231,709		$	170,485			622	%
Percentage of Sales		7	%		2	%		5	%

Selling, general and administrative expenses for the quarter ended June 30, 2008 were $1,231,709, an overall increase of $1,061,224, or 622%, when compared with the corresponding period in 2007. This was 7% of revenue which was a 5% increase over the same period last year where these expenses were 2% of revenue. The increase in selling, general and administrative expenses was primarily due to increased, correlated, sales activities, such as advertising of $480,457 in the period which is an increase of $475,719 and increased staffing expenses related to the buildup of the executive and sales teams of $241,136 in the period which is an increase of $187,624. Specifically, as referenced in the footnotes, advertising expenses increased $475,719 to $480,457 in June 30, 2008 compared to the same period in 2007 which was $4,738. This is due to our increased media coverage in 6 provinces and print coverage in 10 provinces whereas in the same period in 2007 advertising was primarily word of mouth.

Loss on change in fair value of derivative liabilities

The Company has accounted for warrants issued to investors and Roth in April Offering in year 2008 as liability measured at fair value. The change in their fair value during the three months ended June 30, 2008 charged to Consolidated Statement of Income of a loss of $2,154,323. No such loss was recognized for the three months ended June 30, 2007, as the Predecessor Company did not issue any such security during the year 2007.. In addition, the loss recognized for the three months ended June 30, 2008 was due to the significant increase of our stock price at June 30, 2008 ($3.50) compared to that at April 17, 2008 ($2.22).

Income Tax

The Company did not carry on any business and did not maintain any branch office in the United States during the three months ended June 30, 2008 and 2007. Therefore, no provision for withholding or U.S. federal income taxes or tax benefits on the undistributed earnings and/or losses of the Company has been made.

The Company’s Cooperative Joint Venture subsidiary, Yongye Nongfeng Biotechnology Co. (“Yongye Nongfeng”), is subject to PRC Enterprise Income Tax at a rate of 25% of net income from its foundation on January 4, 2008 to March 31, 2008, and 1.25% of gross revenue since April 1, 2008.  The difference in tax rates occurred because, while the CJV was entitled to the “Check and Ratify” taxation method rate, and did apply for it, the CJV did not receive approval for such rate until the second quarter of 2008. Under the PRC taxation system, the enterprise income taxation is conducted on a quarter by quarter basis and, therefore, we were subject to the rate of 25% of net income for the full first quarter of 2008 and computed the tax at 1.25% of gross revenue for the remaining three quarters of 2008.

 For the three months ended June 30, 2008, the Company’s income tax expense was $219,983 and income tax payable were $406,530 compared to $0 and $893,892 for the same period in 2007.

21

Net income

			Predecessor
			Inner Mongolia
	Yongye Nongfeng Biotechnology		Yongye
	JUNE 30, 2008		JUNE 30,0		Increase/
	Unaudited		2007		(Decrease)
Net income	$	5,006,532	$	3,312,794		51	%

Net income was $5,006,532 for the three months ended June 30, 2008 and was 28% of revenue for the quarter. This was an increase of $1,693,737, or 51%, when compared to net income of $3,312,794 for the same period of 2007, and represented 45% of revenue for the quarter. This is an overall increase of 51%, which is the result of an increase in sales revenue due to expansion of our number of branded stores and distribution network overall. By percentage of revenue, however, net income is down 16% over the prior period due largely to other expenses of $2,540,732 which is mainly the loss generated by change in fair value of derivative liabilities, and minority interest of $603,194, which is new for this quarter. These two expenses combined were 14% of revenue for the quarter.

Basic and diluted earnings per share (EPS) for the three months ended June 30, 2008, were $0.27. The weighted average shares outstanding used to calculate basic and diluted EPS for the period were 18.5 million.

Foreign Currency Translation Gains

The reporting currency of the Company is the US dollar. We use our local currency, Renminbi (RMB), as our functional currency. Results of operations and cash flow are translated at average exchange rates during the period, and assets and liabilities are translated at the unified exchange rate at the end of the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income in the statement of shareholders’ equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

The value of the USD versus the RMB continued to decline during the second quarter of 2008. As a result of the appreciation of the RMB, we recognized a foreign currency translation gain of $277,101 for the second quarter of 2008 compared to a gain of $127,723 for the same quarter last year. Given the uncertainty of exchange rate fluctuations, we cannot estimate the effect of these fluctuations on our future business, product pricing, and results of operations or financial condition. All of our revenues and expenses were denominated in RMB Yuan and both the income statement accounts and balance sheet amounts were translated at 1 RMB Yuan to 0.1414 USD.

Liquidity and Capital Resources

Inner Mongolia Yongye, the predecessor company, has historically financed its operations and capital expenditures principally through shareholder loans, bank loans, and cash provided by operations. As a newly formed Cooperative Joint Venture, Yongye Nongfeng, has used the net proceeds of both the April and September Offerings of approximately $20 million to finance the purchase of raw materials and finished inventory from Inner Mongolia Yongye, capital equipment and an expansion of our facilities and production, build out of our distribution network through advertising and marketing programs and their associated expenses, and increasing the number of our branded stores that distributors will do once they have more product available and more advertising coverage. We believe customers will increase, product will be pulled through the channels and distributors will penetrate the market with more branded stores to accommodate and spur sales growth.

As is customary in the industry, we provide payment terms to most of our distributors which typically exceed the terms that we ourselves receive from our finished goods suppliers.  We typically provide 90 day terms to our provincial level customers and ask for all others to make cash payments up front or upon delivery.  Therefore, the Company’s liquidity needs have generally consisted of working capital necessary to finance receivables and raw material inventory. We believe that over the next 12 months our existing cash, cash equivalents and cash flows from operations will be sufficient to meet our anticipated future cash needs. We may, however, require additional cash resources due to changing business conditions or other future developments, including any investments or acquisitions we may decide to pursue. We will determine how to meet these specific cash flow needs as they arise. Therefore, there can be no assurance that such additional investment will be available to us, or if available, that it will be available on terms acceptable to us. Cash and Cash Equivalents balance amounted to $1,350,330 and $1,102,032 as of June 30, 2008 and June 30, 2007, respectively.

Financial Cash Flow Highlights for Six Months Ended:

	For the Six Months Ended						Increase
	JUNE 30, 2008			JUNE 30, 2007			/(decrease)
Net cash used in operating activities		(7,604,652	)		(4,661,989	)		63	%
Net cash used in investing activities		(762,418	)		(22,380	)		3307	%
Net cash from financing activities		9,294,492			5,675,591			64	%
Effect of exchange rate change on cash and cash equivalents		414,771			21,787			1804	%
Net increase in cash and cash equivalents		1,342,193			1,013,009			32	%
Cash and cash equivalents at beginning of period		8,137			89,023			(91	)%
Cash and cash equivalents at end of period	$	1,350,330		$	1,102,032			23	%

22

The changes described above were generally due to the fact that our largest customers typically pay us 90 days after we ship products to them, which is according to the terms set in the agreements with them.  Because we are constrained by the seasonal forces and the elongated payment terms of the agriculture industry, we slowly build up accounts receivable starting in the first quarter and more rapidly add to this throughout the peak season of the second and third quarter. As the end of the year approaches, we typically have had the ability to collect a great deal of our receivables so as to start the new year with a much lower balance.

Because of the seasonal nature of agriculture industry, the peak season for the sale of our product is in the second and third quarters of the year. We normally build up inventory in the first and fourth quarters to prepare for shipments to customers as they order product for the peak selling season in the second and third quarters. The significant increase in the balance of inventory we recently experienced was in line with this business practice. Additionally, our contract manufacturer brought on increased capacity from 2,000TPA to 10,000TPA in preparation for increased sales of the product which we expect to occur. We expect that we will maintain a similar balance in the future year ends.

The Company's working capital at June 30, 2008, increased to $13,233,278 from $2,655,790 on December 31, 2007. The increase in working capital resulted from growth in the Company's overall business and the use of cash earnings to fund increases in accounts receivable and inventories. Accounts receivable Days Sales Outstanding (“DSO”) is defined as average accounts receivable for the period divided by net sales per day and for the six months ended June 30, 2008 decreased to 69 days at June 30, 2008 from 81 days at June 30, 2007 and Days Sales in Inventory (“DIO”) is defined as average inventory in the period divided by the cost of sales per day and decreased by 4 days to 75 days at June 30, 2008 from 79 days at June 30, 2007. As is customary in China’s agriculture industry, we give credit terms which allow our distributors to pay over a longer period of time than is traditionally done in other industries.

For the six months ended June 30, 2008, net cash used in operating activities was $7,604,652. Reductions in cash were primarily attributable to increases of $5,196,266 in inventories and $20,613,347 in accounts receivables. These were offset to some degree by net income of $5,587,862, an adjustment for depreciation of $93,263, a loss generated by change in fair value of derivative liabilities of $2,154,323 and an increase in accounts payable and accrued expenses of $6,772,337.

For the six months ended June 30, 2008, net cash used in investing activities was $762,418 and was primarily attributable to the build out of the Beijing office with improvements of $639,519 over the first six months of 2008 and the purchase of intangible assets (patent and accounting software) of $122,899.

For the six months ended June 30, 2008, gross cash from financing activities was $10,100,651 from the PIPE investment received on April 17, 2008. This was offset by expenses incurred in issuance of stock to shareholders of $806,159 resulting in net cash of $9,294,492.

SIX MONTHS ENDED JUNE 30, 2008 AND JUNE 30, 2007

Financial Highlights

In summary, we saw the following financial performance over the last six months:

	For the six months ended						Increase
	JUNE 30, 2008			JUNE 30, 2007			/(decrease)
Sales	$	26,986,639		$	8,127,718			232	%
Gross Profit	$	14,567,619		$	3,780,957			285	%
Income from Operations	$	9,758,017		$	3,554,778			175	%
Net Income	$	5,587,862		$	3,358,428			66	%
Gross Margins		54	%		47	%		7	%
Net Margins		21	%		41	%		(20	)%

Net Sales

Sales revenue increased by $18,858,921, or 232%, to $26,986,639 for the six months ended June 30, 2008 from $8,127,718 for the same period ended on June 30, 2007. This can be attributed to our investment in our distribution channels and build up of branded stores which put more product in the hands of end users. We have increased the number of stores from inception in 2007 to 775 stores by June 30, 2008. The Company and the Predecessor’s total sales to our five major customers were $24,068,529 and $7,961,977, for the six months period ended June 30, 2008 and 2007, respectively.

23

Gross Profit Margin

We achieved gross profit of $14,567,619 for the six months ended June 30, 2008, up 285% from gross profit of $3,780,957 for the corresponding period in the prior year. Gross profit margin for June 30, 2008 was 54%, up 7% from 47% as compared to the corresponding period in 2007. This is largely attributed to our fixed price contract for finished goods which has stabilized our cost of goods sold.

Selling, General and Administrative ("SG&A") Expenses

We incurred total SG&A expenses of $ 4,809,602, or 18%, of revenue, for the six months ended June 30, 2008. As compared to the same period in 2007, this represented an increase of $4,583,423 or 2026% over SG&A expenses of $226,179 which was 3% of revenue. Much of this increase is due to increased expenses for operating as a public company, hiring additional executive team members and increased advertising expenses which, due to the seasonal nature of our business, must be expended in Q1 and Q2 in order to reach customers for the growing season starting early in Q2.

Loss on change in fair value of derivative liabilities

The Company has accounted for warrants issued to investors and Roth in April Offering in year 2008 as liability measured at fair value. The change in their fair value during the six months ended June 30, 2008 charged to Consolidated Statement of Income of a loss of $2,154,323. No such loss was recognized for the six months ended June 30, 2007, as the Predecessor Company did not issue any such security during the year 2007. In addition, the loss recognized for the six months ended June 30, 2008 was due to the significant increase of our stock price at June 30, 2008 ($3.50) compared to that at April 17, 2008 ($2.22).

Net Income

Our net income was $5,587,862 or 21% of revenues for this six month period in 2008 which was $2,229,434 or 66% increase over the same six month period in 2007 which was $3,358,428 and 41% of revenue. The increase reflected continued expansion in sales revenue levels, continued strong demand for our products and sustained profitability.

Basic and diluted earnings per share (EPS) for the six months ended June 30, 2008, were $0.37. The weighted average shares outstanding used to calculate basic and diluted EPS for the comparative periods were 15.0 million.

Impact of inflation

We are subject to commodity price risks arising from price fluctuations in the market prices of the raw materials. We have generally been able to pass on cost increases through price adjustments. However, the ability to pass on these increases depends on market conditions influenced by the overall economic conditions in China. We manage our price risks through productivity improvements and cost-containment measures. We do not believe that inflation risk is material to our business or our financial position, results of operations or cash flows.

Related Party Transactions

Inner Mongolia Yongye is a 1.15% owner of Inner Mongolia Yongye Nongfeng. Mr. Zishen Wu controls Inner Mongolia Yongye and is CEO of Inner Mongolia Yongye Nongfeng Biotechnology. He also sits on the boards of both companies as Chairman. During the period ended June 30, 2008 Inner Mongolia Yongye Nongfeng entered into several intercompany loan transactions with related party entities as described in the footnotes to the financial statements above. Additionally, In January 2008, Inner Mongolia Yongye Nongfeng Biotechnology entered into a Cooperation Agreement with Inner Mongolia Yongye providing for the terms of contract manufacturing of nutrient product and has also entered into a Sales Agreement in April 2008 providing for the sale of existing nutrient inventory. The terms of these agreements have been disclosed in the Joint Venture contract as filed with the SEC on April 17, 2008.

Off Balance Sheet Arrangements

We do not have any off-balance sheet arrangements as defined by standards issued by the Financial Accounting Standards Board, and accordingly, no such arrangements are likely to have a current or future effect on our financial position, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

24

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: October 19, 2009

YONGYE INTERNATIONAL, INC.
By:	/s/ Zishen Wu
	Zishen Wu
	President and CEO
By:	/s/ Sam Yu
	Sam Yu
	Chief Financial Officer

26

EX-31.1

Exhibit 31.1

PART II.CERTIFICATION

I, Zishen Wu, certify that:

1.  I have reviewed this quarterly report on Form 10-Q/A Yongye International, Inc.

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4.  The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: October 19, 2009	By:	/s/ Zishen Wu
		Zishen Wu
		President and CEO (Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Sam Yu, certify that:

1. I have reviewed this quarterly report on Form 10-Q/A of Yongye International, Inc.

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterlyreport;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)  designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

(c)  evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)  disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of registrant’s board of directors:

(a)  all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: October 19, 2009	By:	/s/ Sam Yu
		Sam Yu
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of Yongye International, Inc.. (the “Company”), does hereby certify, to such officer's knowledge, that:

The Quarterly Report on Form 10-Q/A for the quarter ended June 30, 2008 of the Company fully complies, in all material respects, with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: October 19, 2009	By:	/s/ Zishen Wu
		Zishen Wu
		President and CEO
Dated: October 19, 2009	By:	/s/ Sam Yu
		Sam Yu
		Chief Financial Officer