Fund companies are rapidly applying for agricultural-themed ETFs. What does this signal?

In recent days, multiple fund companies have filed for agriculture-themed ETFs in rapid succession, including those focused on food grains and livestock breeding.

On March 31, Ping An Fund applied for the Ping An CSI Agricultural Theme Index Fund as an actively initiated fund. On March 27 and March 26, respectively, Bosera Asset Management and Fortune Global Asset Management had applications for China Securities Grain Industry ETFs. Only within March, there were a total of more than 10 ETF applications, with the focus concentrated on agricultural sub-sectors such as food grains and livestock breeding. A fund manager pointed out that the recent concentrated filing of related ETFs reflects institutions’ relatively consistent judgments formed from the sector’s fundamentals and policy catalysts. They believe it has medium- and long-term allocation value, and institutions are moving early to seize the layout window.

From the perspective of the secondary market, nearly all of the relevant theme ETFs have seen their assets grow since the beginning of the year. The number of units of the Fortune CSI Agricultural Theme ETF increased by more than 1.082 billion units, the number of units of the Penghua China Securities Grain Industry ETF increased by more than 985 million units. In addition, the number of units of the Invesco Great Wall Agriculture, Livestock and Fishery ETF and the Tianhong CSI Agricultural Theme ETF increased by more than 739 million and 639 million units, respectively. Moreover, against the backdrop of overseas geopolitical turmoil from late February to mid-March, China’s A-share agriculture sector remained strong; the interval gains of multiple ETFs exceeded 10%, becoming a “safe haven” for inflowing capital.

Multiple public fund managers stated that the leading drivers in the agriculture sector mainly come from the fertilizer segment. Its strong performance is the result of the “three-factor resonance” of seasonal demand, cost push, and geopolitics.

Harvest Fund said that since the 2026 Spring Festival falls later, in March the spring farming and procurement peak will officially begin, directly boosting demand for fertilizers and pesticides, thereby supporting product prices and corporate earnings. At the same time, the Middle East geopolitical conflict has led to fluctuations in the prices of oil and gas resources, raising the production costs of high-energy-consumption fertilizers such as nitrogen fertilizers. In the market, trading follows the transmission chain of energy—chemicals—agricultural inputs, and a cost-support-driven price increase logic has thus been established. In addition, sub-sectors such as the phosphate chemical industry are shifting from a pure cyclical logic to a “resources + growth” logic. Under a geopolitical security background, the value of certain strategic resources such as phosphate rock is being reassessed, driving a reshaping of sector valuations.

Invesco Great Wall Fund said that agricultural products are also a key focus of this round of the “anti-overlap without innovation” trend. With industries such as pork, aquatic products, and grains all responding to policy calls and actively reducing capacity, the supply of agricultural products is expected to be optimized, thereby pushing corporate earnings to rebound.

Harvest Fund’s analysis suggested that, as a relatively broad concept, the agriculture sector currently shows clear, differentiated logic in the fundamental projections of each core sub-sector:

In the seed industry, policy guidance and technological change are the main driving forces. In 2026, the Central No. 1 Document continues to reinforce food security, clearly proposing to promote the industrialization of bio-breeding. Harvest Fund believes that the policy top-level design has shifted from stabilizing production to increasing yields per unit area, and the rollout of bio-breeding commercialization is accelerating. While grain prices may fluctuate in the short term, expectations of global liquidity easing and inventory destocking support prices in the medium term. Supported by technological barriers, leading seed companies are expected to deliver performance by increasing market share amid industry reshuffling.

The fertilizer and pesticide segment is expected to continue maintaining a tight supply-demand balance pattern. In the near term, phosphate fertilizer prices have remained at a high level, and corporate profitability is secure, with the cost-support logic continuing to be strengthened.

The livestock segment is in a typical left-side positioning period. The hog breeding industry is currently in a “losses bottoming out” stage, with hog prices around 12 to 13 yuan/kg, below the cost line of about 14 yuan/kg. Continued losses, combined with policy guidance, are making the capacity reduction trend increasingly clear. The core of market trading lies in the expectation that “capacity reduction will lead to a future contraction in supply.” As the inventory of breeding sows that can produce piglets approaches the policy target, the certainty of the cycle reversal is building up, and the segment has excellent defensive and counter-offensive attributes.

(Editor: Xu Nannan)

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