2023 is the third year of the "three-year foundation" of the seed industry revitalization action, and it is also a key year to solidly promote the start. Judging from the performance of the 2023 annual report of listed seed enterprises, the overall seed business of the enterprise has increased steadily, and the prosperity of the industry has improved. The effect of seed industry enterprises is obvious, the seed industry innovation has entered an active period, the characteristic crop industry has entered the fast channel of development, the industrialization of biological breeding has been accelerated, the quality of production base construction has been upgraded, and the market environment has been further purified. At the same time, the integration of the seed industry is accelerating, and the competition is more intense, requiring seed industry enterprises to expand their development space in an all-round way.
The overall prosperity of the development of the seed industry
In 2023, the overall development of the mainland seed industry will be booming. Among the 11 listed seed enterprises in statistics, the operating income of 2 enterprises decreased compared with the previous year, Suken Agricultural Development decreased by 4.39%, and Shennong Technology decreased by 12.51%. The operating income of the 9 enterprises increased over the previous year, with an increase of 3.07%~35.89%. The net profit attributable to shareholders of listed companies of 5 enterprises decreased compared with the previous year, namely Dabeinong, Suken Agricultural Development, Nongfa Seeds, Fengle Seeds and Wanxiang Denong. The net profit attributable to shareholders of listed companies of 6 enterprises increased by 1.01%~124.02% over the previous year.
The results of the 2023 annual report of the listed seed enterprises
Although the performance of some companies declined, the overall performance of the seed business was still good. Among them, the decline in Dabeinong's performance was mainly affected by the loss of pig business and the impairment loss of various assets and credit impairment loss. In 2023, the number of Dabeinong seeds sold will increase by 47.39% over the previous year, and the revenue of seed business will increase by 48.84%. In 2023, the overall operating income of the crop segment of the agricultural development and seed industry will be 2.338 billion yuan, an increase of 25.4% over the previous year. The net profit attributable to shareholders of listed companies decreased by 31.62% over the previous year, mainly due to the decline in the performance of the company's agrochemical industry, but the seed industry performed well, and the operating income increased by 34.23%. The gross profit margin of Suken Agricultural Hair Seed Processing and Sales Business remained stable.
The net profit attributable to shareholders of listed companies increased significantly by Longping Hi-Tech and Dunhuang Seeds, with Longping Hi-Tech increasing by 124.02% over the previous year and Dunhuang Seed Industry increasing by 103.88% over the previous year. One of the main reasons for the significant increase in Longping Hi-Tech's operating performance is the significant growth of its main business in China, with revenue exceeding 5 billion yuan, an increase of 44.70%. Among them, Longping Development was included in the company's consolidated financial statements, contributing revenue of 3.886 billion yuan, and the company's overall revenue scale reached a new level. In 2023, Longping Hi-Tech's independent R&D capabilities will continue to improve, high-yield and high-quality varieties will be welcomed by the market, market share will continue to increase, and the operating income of domestic corn seeds and rice seeds will increase significantly compared with the same period last year. Dunhuang Seed Industry pointed out that in 2023, the company will actively expand the production area of seed production, increase the operation of its own varieties, strengthen the fine management of all links, and greatly improve the quality and efficiency of the seed industry. It is reported that in 2023, the production area of Dunhuang Seed Industry's own varieties will exceed the production area of generations for the first time, and the market performance of varieties such as "Xianyu 1483" and "Dunyu 810" will be outstanding, and the supply of seeds will exceed demand, achieving a new breakthrough in the transformation from generational multiplication to self-owned variety management.
Looking at the overall situation of the crop seed market in 2023, the analysis of the agricultural seed industry shows that the overall supply and demand of wheat seeds are basically balanced, and the price of seeds is basically stable. The seed production area and total output of hybrid maize have reached a new high in the past ten years, some mainstream best-selling varieties are in short supply, and the pilot of maize transgenic varieties has been expanding. The seed production area of hybrid rice and conventional rice has increased, and the overall supply of rice seeds exceeds demand, and the production cost of rice seeds has risen but the price has been sluggish. The production area of soybean seeds continued to increase, and the soybean planting area was transformed from planting food beans to oil soybeans, and breeding and promotion gradually changed to high-oil soybean varieties. Under the guidance of the national policy of stabilizing grain and expanding oil, the production layout of rapeseed has been steadily promoted, the supply of rapeseed is balanced, the supply of rapeseed exceeds demand in some areas, and high-yield and machine-harvested varieties are more popular.
The corn seed market is highly competitive
The cost of corn seed production in mainland China continues to rise, and the supply of corn seeds is seriously oversupply, which has become one of the characteristics of market operation in 2023. All enterprises pointed out in the report that the cost of insurance per mu in Gansu base increased by about 10%, and the high cost forced seed production enterprises to transfer to traditional seed production areas such as Xinjiang, Northeast China and North China, and invested in new large-scale seed processing lines, gradually forming a new base competition pattern, and the trend of "decentralization" of seed production bases appeared. Among them, the seed production area of Xinjiang has surpassed Gansu and has become the largest corn seed production base in the country.
From the perspective of the supply and demand of corn seeds, Dunhuang Seed Industry pointed out that in 2023, the national corn seed production will be 4.6 million mu, and it is expected that 1.75 billion kg of new seeds will be produced, plus 290 million kg of effective inventory in 2022, and the total supply will reach 2.04 billion kg, which is 820 million kg more than the total demand of 1.22 billion kg, and the corn seed industry will enter a new round of high inventory cycle. Qiule Seed Industry pointed out that the overall market of corn seeds shows a trend of oversupply, and the variety market shows a trend of polarization. The main best-selling varieties have high prices, strong premium ability, and a backlog of homogeneous varieties.
When analyzing the corn seed market this year, Wanxiang Denong pointed out that in 2024, the competition in the seed industry will still be fierce, the genetically modified varieties will be gradually approved, the output value of the corn core seed production base per mu will remain high, and there may be a certain oversupply in the seed market.
The research and development process of new varieties has accelerated
In 2023, the revitalization of the seed industry will continue to deepen, policy support will continue to increase, the state will continue to encourage original innovation in breeding, enterprises will continue to strengthen their R&D investment in new varieties, and new varieties will continue to emerge.
Longping Hi-Tech and its subsidiaries have independently cultivated or jointly cultivated 39 new rice varieties and 34 new corn varieties, and the company's rice variety structure has been further improved, and corn has achieved full coverage of varieties and regions. The company applied for 327 plant variety rights, and 244 were authorized. In 2023, 73 new varieties of Winwin Hi-Tech will be approved by the state. Among them, there are 64 new hybrid rice varieties, 8 new hybrid corn varieties and 1 new cotton variety. 41 new varieties have passed the provincial examination. Among them, there are 17 new varieties of rice, 15 new varieties of hybrid corn and 9 new varieties of wheat. During the reporting period, a total of 40 new varieties of agricultural development and seed industry companies passed the examination/registration. Among them, there are 10 wheat varieties, 15 corn varieties, 12 rice varieties and 3 rape varieties. In addition, the company successfully bid for the top new super-gluten wheat variety "Xinmai 58" in China.
In 2024, the No. 1 document of the Central Committee proposes to solidly promote a new round of 100 billion catties of grain production capacity improvement action, and put the focus of grain production increase on a large area to increase yield. Nongfa Seed Industry pointed out that in the future, the market urgently needs to breed and promote a number of varieties with high yield potential, high yield and strong stress resistance, stable yield and easy planting, and suitable for order planting. Specifically, in the wheat seed industry, in recent years, extreme weather during the growth period of wheat has occurred frequently, and the new varieties with high yield, stable yield, multiple resistance, and suitable for orders have strong market competitiveness. In terms of maize seed industry, due to the frequent occurrence of extreme climate, varieties are regionalized and polarized. The main best-selling varieties have high prices and strong premium ability, and the varieties with high temperature resistance, rust resistance and bacterial wilt resistance in the Huanghuaihai region will be favored by the market. In terms of rice seed industry, affected by market demand, the upgrading of varieties has accelerated, and the demand for characteristic varieties has increased. The scale of high-quality, high-yield and widely adaptable varieties will be expanded, and the market demand for fragrant high-quality rice varieties dedicated to orders will continue to increase.
The continuous research and development and approval and promotion of new varieties provide a strong guarantee for the sustainable development of enterprises, but enterprises should also be vigilant against the risks of market promotion of new varieties. Denghai Seed Industry pointed out that due to the short time to market of most new varieties and the influence of climate changeability, their planting and promotion have not yet been tested by a complete large-scale planting season, and the performance of the field needs to be further determined. In addition, with the acceleration of the commercialization of genetically modified varieties, it will have a huge impact on the research and development, production and sales of non-genetically modified varieties. Enterprises should combine their own competitive advantages, while stabilizing the production and sales of conventional varieties, further accelerate the reserve, approval and promotion of maize genetically modified varieties, and steadily increase market share.
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Article source: Agricultural Resources Herald
Editors of this issue: Zhai Yiting and Wei Rong
Review of this issue: Wang Meihong
Producer of this issue: Jiang Shanjun
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