GF SEC: Convert new crop varieties approved by the national review into "quality breakthroughs"

GF SEC released a research report stating that the Ministry of Agriculture has released a new batch of national approved varieties of rice, corn, and other crops. The number of high-quality, green, and resistant rice varieties continues to increase, with the development of high-density, high-yield, and suitable for mechanized harvesting varieties becoming the main direction for corn breeding. Leading companies have performed well in the development of new varieties, with the expectation of further increasing their market share. On December 31, 2024, the Ministry of Agriculture and Rural Affairs issued a new batch of national approved varieties announcement, including 405 rice varieties, 888 corn varieties, 50 cotton varieties, 34 soybean varieties, and 2 wheat varieties that have passed national approval. Key points from GF SEC are as follows: Shift from "quantity growth" to "quality breakthrough" in national approved varieties Since 2021, the threshold for new variety approval has been significantly increased, resulting in a 17%/1%/1% year-on-year decrease in the number of national approved varieties (including genetically modified) from 2022 to 2024. The market homogenization and competitive intensity are expected to continue to decrease. Rice: Continuous increase in the number of high-quality, green, and resistant new varieties The number of "three good varieties" that are high-yielding, high-quality, and green (disease-resistant) has been increasing year by year, reaching 22/28/31 varieties in 2022-24, respectively. The number of varieties meeting the first-class standard of "edible rice variety quality" has also been increasing year by year, with 44/50/70 varieties in 2022-24, respectively. Leading companies have a higher proportion of green and high-quality varieties. Yuan Longping High-Tech Agriculture, Winall Hi-tech Seed, respectively had 31 and 59 new rice varieties approved nationally, with 8 and 18 new varieties meeting the first-class standard of "edible rice variety quality," accounting for a total of 37%. Corn: High-density, high-yield, and suitable for mechanized harvesting varieties have become the main direction for breeding since 2023 The Central Document No. 1 in 2023 explicitly stated the need to implement the corn yield increase project, leading to a transition in grain corn varieties from sparse planting, tall stalk, and large ear type to multiple-resistant, high-yield, high-density, widely adaptable, and suitable for mechanized harvesting types. The number of new high-density varieties approved nationally increased further in 2024, with 47 varieties having a planting density of 5500 plants per mu or more, an increase of 1000 plants over conventional density. In the Northwest Spring Maize Region, 70 varieties and in the Northeast Spring Maize Region, 2 varieties had trial yields exceeding 1000 kg per mu. The proportion of new varieties from leading companies has increased year on year, demonstrating superior performance in high-density and high-yield traits. Yuan Longping High-Tech Agriculture, ShanDongDenghai Seeds, Winall Hi-tech Seed, KANGNONG SEED, Zhongnongfa Seed Industry Group had 46/22/16/11/6 varieties respectively approved nationally, with an increase of 24, 6, 8, 4, and a decrease of 3 from 2023. The combined share of varieties from these five companies is approximately 11%, showing a 3-percentage point increase compared to 2023. Yuan Longping High-Tech Agriculture, ShanDongDenghai Seeds, and Zhongnongfa Seed Industry Group had 7/2/1 varieties with planting density of 5500 plants per mu or more, accounting for 21% of the total high-density planting varieties in this batch. In addition, Yuan Longping High-Tech Agriculture and Winall Hi-tech Seed had 7 and 1 varieties with average yields exceeding 1000 kg per mu. Investment recommendation: Leading companies have performed well in the development of new varieties, and their market share is expected to further increase. Therefore, it is suggested to pay attention to Yuan Longping High-Tech Agriculture(000998.SZ), ShanDongDenghai Seeds(002041.SZ), Winall Hi-tech Seed(300087.SZ), KANGNONG SEED(837403.BJ), etc. Risk warning: Policy risks, natural disaster risks, and unexpected R&D progress, etc.