Hainan Shennong Technology Co Ltd

This year's autumn farming season has seen more high-end smart agricultural machinery products put into frontline use, with accelerated industrial application of grain combine harvesters with an 18-kilogram-per-second feed rate and plant protection drones with an 85-kilogram payload. On October 8, the CSI Agriculture Thematic Index rose 0.35%, with constituent stocks including Zhongnongfa Seed, Shennong Seed, and Hainan Rubber leading gains; the underlying index of Agricultural ETF Tianhong rose 0.59%, with turnover exceeding 670,000 yuan, and net inflows of nearly 50 million yuan over the past week as of September 30. Sinolink Securities noted that China continues to promote the revitalization of the seed industry and boost output by raising grain yields per unit area. Global weather disruptions may cause some decline in crop production. At present, the planting sector's prosperity has bottomed out and stabilized, and grain prices have begun to rise. If a substantial reduction in grain output occurs, the prosperity of the planting industry chain is expected to improve.

JPMorgan recently issued a report warning that the next global food crisis may be brewing and could erupt next year. A-share agricultural stocks responded with broad gains on August 17, with Jinjian Rice hitting the daily limit up, and Qiule Seed, Shennong Seed, Kangnong Seed, Dunhuang Seed, and Shenzhen Cereals Holdings following higher. The report expects global food price inflation to rise from 2.8 percent in the first half of this year to 5 percent in the first half of next year. It also argues that Middle East conflict has disrupted passage through the Strait of Hormuz, and that a strong El Niño could reduce crop yields. The combination of these factors will hit agricultural production and keep food prices elevated through the first half of 2027. Nora Szentivanyi, the economist who led the research, said global crop prices have not yet peaked because transport of agricultural inputs such as fertiliser has been affected. This year's shock to global energy supply could double the impact of a super El Niño on food prices. The report also notes that agriculture in parts of Asia, Africa, and Latin America is more sensitive to weather changes, and food accounts for a higher share of household consumption there. Emerging market economies will be hit hardest by this shock. Last year, about 645 million people worldwide faced hunger, and about 2.1 billion people faced moderate or severe food insecurity, accounting for 25.8 percent of the global population.