"Belt and Road Initiative" huge space for agricultural cooperation, seed industry is the core.

Agricultural "Belt and Road Initiative" strategy: build China's granary and protect the local people's livelihood. The hard constraints and sustainability of agricultural resources, the rigid growth of demand for agricultural products, food security is national security, and so on, are the agricultural conditions of our country. The "Belt and Road Initiative" strategic initiative put forward by the Chinese Government has won the support of countries along the route and has entered the stage of implementation.

Citic Securities expects that promoting China's agricultural international cooperation strategy and implementing the new idea of "two markets and two resources" for agricultural development is one of the core contents of the "Belt and Road Initiative" concept. There is synergy between agriculture and other strategies, which is not only an economic grasp, but also a political weight in diplomacy. In the long run, the Chinese government wants to build overseas agricultural bases that guarantee local, supply China and balance the world, while Chinese enterprises have to complete the strategy of global development in this process.

Chinese agriculture goes out of the "Tianji horse racing" technique: technical gap, political gap. 1. Compared with any other country in the world, China's hybrid rice breeding technology is in the lead. 2, compared with the countries along the "Belt and Road Initiative", some of China's agricultural industries have technological advantages or product cost-effective advantages. 3. Compared with the European and American enterprises with the strongest comprehensive strength in the world, China has political advantages in the countries along the "Belt and Road Initiative" route. At the operational level, China's crops have high yield per unit area, good quality, and rich experience in the operation of the aquaculture industry chain; the Chinese government not only encourages superior technology to "go global". And provide strong financial support; the demand for agricultural development in countries along the "Belt and Road Initiative" route is exuberant and urgent. We believe that if we make a good industrial strategy to enhance our strengths and circumvent our weaknesses and find a win-win entry point for all parties, the internationalization of China's agriculture will be realized soon.

More than half of the countries along the "Belt and Road Initiative" are suitable for agricultural cooperation, and the market space is huge. From the dimensions of agricultural production efficiency, economic and political maturity, and land conditions, CITIC Securities selected 41 target countries as the most suitable for agricultural investment, among which seeds, animal protection, agricultural technology services, agricultural machinery and other fields are expected to be the focal points. and the seed industry is the core. The ecological environment and industrial environment of the above-mentioned countries or some regions are similar to those of China. As long as the intergovernmental working mechanism is in place, China's cost-effective seeds, animal protection and other products can enter the target areas and achieve benefits by means of trade. on the other hand, the localization of time-consuming technologies and industries can be promoted steadily. Citic Securities estimates that the market space for cooperation in the planting industry is at least 547 billion yuan (three major seeds + agricultural machinery sales), and the market space for cooperation in the aquaculture industry is at least 200 billion yuan (animal health + feed).

Risk factors: the strength of national policy support is lower than expected; the business environment and political environment of the target country fluctuate; the progress of overseas business expansion is slow.

Investment strategy: agricultural "Belt and Road Initiative" strategy is good for the entire agricultural sector, in which the seed industry and animal protection directly benefit. China's economy has entered the development stage of back-feeding agriculture, and the landing of the strategic concept of "Belt and Road Initiative" is expected to accelerate the pace of the leading agricultural enterprises to go out. The leader of China's agricultural enterprises will enter an unprecedented period of strategic opportunity. From the perspective of industrial cycle, all agricultural sub-sectors have entered the cycle upward channel, and the performance of leading companies is expected to continue to improve. In the next six months, intensive policy release, overseas expansion, industrial mergers and acquisitions, currency issuance and other factors will form catalysis. Key recommendations: Denghai seed industry, agricultural development seed industry, Dabinong and other seed industry leaders; aquaculture industry chain leaders: Tiankang Biological, Ripu Biological, Jinyu Group, China Animal Husbandry shares, Hefeng Animal Husbandry, New Hope, Haida Group, etc.; and Yasheng Group, Cofco Tunhe, which are expected to benefit from the strategic layout of agriculture.