China Great Wall: Policy proposes new quality agricultural productivity, promoting high-quality development of agricultural machinery.

China Great Wall released a research report stating that the enhancement of new agricultural productivity emphasizes the leading role of technological innovation. This will lead agricultural machinery enterprises to increase their investment in intelligent technology, such as applying mature technologies like new energy, digital technology, and artificial intelligence to agricultural machinery equipment to achieve intelligent upgrades. At the same time, it also sets requirements for the independent controllability of domestic agricultural machinery equipment. On the market side, the document also proposes to promote the scrapping and renewal of old agricultural machinery, which is expected to strengthen the market demand for new types of agricultural machinery and accelerate the phasing out of old agricultural machinery, thus promoting the transformation of agricultural production methods towards intelligent, precise, and efficient. In this context, agricultural machinery enterprises with technological innovation capabilities, reliable product quality, and comprehensive after-sales service are expected to expand their market share and enhance their profitability. It is recommended to pay attention to the leading domestic tractor company FIRST TRACTOR (601038.SH, 00038). China Great Wall's main viewpoints are as follows: 1. The first mention of the new quality of agricultural productivity to promote high-quality agricultural development. 2. The Central No. 1 Document proposes to promote coordinated efforts in agricultural science and technology. By leading advanced production factors aggregation with technological innovation, develop new agricultural productivity according to local conditions. Targeting the acceleration of breakthroughs in key core technologies, strengthening the overall coordination of agricultural research resources, and cultivating leading agricultural science and technology enterprises. Deepening the implementation of seed industry revitalization actions, leveraging major agricultural research platforms such as "Nanfeng Silicon Valley" to accelerate breakthroughs in a batch of new varieties. Continue promoting the industrialization of biological breeding. Promote the high-quality development of agricultural machinery and equipment, accelerate the research and application of domestically produced advanced and applicable agricultural machinery equipment, and promote the scrapping and renewal of old agricultural machinery. Supports the development of Jiangsu Nonghua Intelligent Agriculture Technology and expands the application scenarios of artificial intelligence, data, and low altitude technologies. The report believes that the new quality of agricultural productivity is led by technological innovation to optimize resource allocation and catalyze industrial transformation and upgrading, achieving high-tech, efficient, and high-quality agricultural development. Technological innovation is the core element, including technologies such as drones, artificial intelligence, and digital technology, the application of which can effectively change the development of agricultural production and expedite the modernization of agriculture. Developing new agricultural productivity is crucial for the transformation from an agricultural power to an agricultural powerhouse, requiring the selection of appropriate technologies and modes to promote the standardized, large-scale, and industrialized development of agriculture, while also breeding new models, new dynamics, and new impetus, enhancing agricultural production efficiency and quality, and boosting our country's international competitiveness in agriculture. The agricultural machinery industry is receiving intensive policy support, which is expected to further stimulate demand. Recently, the agricultural machinery industry has received intensive policy support, including: 1. Regarding the aspects of the policy on scrapping and renewal subsidies for agricultural machinery, the "Supplementary Notice on Intensifying Efforts to Continuously Implement the Subsidy Policy for Scraping and Renewal of Agricultural Machinery" mentioned that provinces can add up to 6 additional types of machinery to the existing 9 types included in the scrapping subsidy range, with a maximum subsidy amount per machine not exceeding 20,000 RMB. The subsidy amount for scrapping tractors below 20 horsepower has been increased to 1,500 RMB; for scrapping combined harvesters, rice transplanters, and seeders and purchasing new equipment of the same type, the subsidy standard has been raised by no more than 50%, with a maximum subsidy of 30,000 RMB per machine; for scrapping and purchasing cotton pickers, the maximum subsidy per machine has been increased to 60,000 RMB. 2. In terms of fund utilization management, the National Development and Reform Commission has directly allocated ultra-long special national bond funds to local governments to support the implementation of agricultural machinery scrapping and renewal. The funds will be shared between the central and local governments according to a 9:1 principle, with the central government bearing 85%, 90%, and 95% of the burden in eastern, central, and western regions, respectively. Provincial-level finances will arrange matching funds based on the distribution of central funds and optimize the application and fund payment process, increase settlement batches, and expedite subsidy payments. 3. Regarding the purchase and application subsidies for agricultural machinery, according to information released by the Ministry of Agriculture and Rural Affairs, the Implementation Opinions on the Subsidy for Scrapping and Renewal Purchases and Applications of Agricultural Machinery for 2024-2026 aims to promote the "optimal machines with optimal subsidies" approach, emphasizing stability in production and supply, focusing on supporting high-end intelligent agricultural machinery and machinery suitable for hilly and mountainous areas, as well as high-performance planters, intelligent high-speed transplanters, and large-scale intelligent high-end combined harvesters that contribute to improving large-scale single-crop yields, meeting the urgent needs of hilly and mountainous agricultural production, and addressing the shortcomings in agricultural machinery and equipment. Risk warnings: Risks of cyclical fluctuations in the agricultural machinery industry; risks of subsidies falling short of expectations; risks of intensified market competition; risks of overseas market expansion falling short of expectations; risks of fluctuations in raw material prices.