Investment Rating - The report maintains a "Positive" investment rating for the industry [11]. Core Insights - In the first half of 2025, China's total exports of HVO and SAF reached 338,400 tons, a year-on-year increase of 8.06%, with domestic SAF export channels successfully opened [2][6]. - Biodiesel exports fell to 381,000 tons, a decrease of 42.4% year-on-year, primarily due to anti-dumping tariffs [7][17]. - UCO exports totaled 1,262,000 tons, down 10.5% year-on-year, with Singapore replacing the U.S. as the largest export destination [8][31]. - The report suggests monitoring overseas policies and demand changes, anticipating more supportive domestic policies to be implemented [9][43]. Summary by Sections SAF & HVO - In H1 2025, China's SAF export channels were successfully opened, with a total export volume of 338,400 tons, marking an 8.06% increase year-on-year. Jiangsu Province exported 14,900 tons of SAF to Belgium and Spain in June, likely from the Jiaao Environmental Lianyungang factory [6][16]. - Domestic SAF exports require approval from four government departments, and Jiaao Environmental received a license for 372,400 tons of bio-jet fuel, indicating a positive trend for future SAF exports [6][16]. Biodiesel - Biodiesel exports in H1 2025 were 381,000 tons, down 42.4% year-on-year, mainly due to anti-dumping tariffs imposed by the EU [7][17]. - Major export partners included Malaysia (141,000 tons), Singapore (98,700 tons), and the Netherlands (70,000 tons), with significant increases in exports to Malaysia and Singapore, likely for blending with marine fuel [7][22]. - The average export price for biodiesel was $1,103 per ton, a slight increase of 2.0% year-on-year, while total export value dropped by 40.6% to $3.02 billion [17]. UCO - UCO exports in H1 2025 were 1,262,000 tons, a decrease of 10.5% year-on-year, attributed to increased domestic SAF production and the cancellation of export tax rebates [8][29]. - The average export price for UCO was $1,048 per ton, up 17.9% year-on-year, driven by the EU's mandatory blending policy for SAF [8][29]. - Singapore became the largest export destination for UCO, with exports to the U.S. declining significantly due to high tariffs [31][35]. Market Outlook - The report emphasizes the need to track overseas policy changes and anticipates more domestic supportive policies to be implemented [9][43]. - The U.S. market faces significant uncertainty due to fluctuating tariff policies, while the EU's blending ratio requirements for SAF are expected to boost China's SAF industry [43]. - In Singapore, the demand for clean alternative fuels is projected to increase due to new carbon quota regulations for the shipping industry [43]. Investment Recommendations - The industry is viewed positively due to its reliance on waste oils as raw materials, with several companies producing qualified SAF and obtaining airworthiness certification. The report recommends focusing on raw material suppliers and processing companies like Zhuoyue New Energy [9][47].

Major Events - The actual controller, chairman, and CEO of Juran Smart Home, Wang Linpeng, passed away on July 27, 2025. He held a total of 43.93% of the company's shares. The board has appointed Wang Ning as the acting chairman and CEO [3] - Shennong Group has decided to terminate its plan for a specific stock issuance for 2024 due to changes in market conditions and will withdraw its application [5] - Xizhuang Co. plans to establish a joint venture to engage in sustainable aviation fuel-related business with a registered capital of 5 million yuan, where Xizhuang will contribute 1.1 million yuan [6] - Shandong Gold's subsidiary, Shanjin International, intends to issue H-shares and apply for listing on the Hong Kong Stock Exchange [7] - Luopusi Co. plans to acquire a 38.38% stake in Wuhan Senfurui Technology Co. for 8.82 million yuan [8] - Hengxin Life plans to invest no more than 505 million yuan to build a biodegradable product production base in Hefei, Anhui Province [9] - Hetai Machinery announced it has not participated in the Yaxi project construction, which is still in the early stages [10] - Kaishan Co. plans to acquire a 5% stake in SMGP for 3 million USD, resulting in full ownership of the company [11] - Ruian New Materials intends to terminate its raw material project due to uncertainties in the second phase of construction [12] - Zhonghua Equipment plans to purchase 100% equity of Yiyang Rubber Machine and Beihua Machine, with stock resuming trading on July 29, 2025 [13] - Huizhou Intelligent announced that a board member has resigned due to being identified as a dishonest executor [14] - Xuefeng Technology plans to acquire a 51% stake in Shengshi Putian for 154 million yuan [15][16] - Top Cloud Agriculture intends to establish a wholly-owned subsidiary focused on artificial intelligence technology with an investment of 20 million yuan [17] - Shiming Technology's actual controller is under detention, but it does not affect the company [18] - Dahua Intelligent is under investigation by the CSRC for suspected information disclosure violations [19] - Dalian Shengya plans to change its controlling shareholder and will resume trading on July 29, 2025 [20] - Fashilong has signed a share transfer agreement and will resume trading on July 29, 2025 [21] - Guangku Technology plans to acquire control of Anjie Xun, with trading suspended from July 29, 2025 [22] - Tianyi Co. has been selected as a candidate for a procurement project by China Mobile [23] - Zhongtung High-tech's subsidiary plans to implement a 1.4 billion drill bit intelligent manufacturing project with an investment of 178 million yuan [24] Performance Overview - WuXi AppTec reported a net profit of 8.561 billion yuan for the first half of 2025, a year-on-year increase of 101.92% [25] - Sujiao Science and Technology's net profit decreased by 39.54% year-on-year, with a revenue of 1.776 billion yuan [26] - Aide Biology achieved a net profit of 189 million yuan, up 31.41% year-on-year [27] - Huicheng Environmental's net profit dropped by 85.63% year-on-year, with a revenue of 564 million yuan [28] - Haida Group reported a net profit of 2.639 billion yuan, a year-on-year increase of 24.16% [30] Major Contracts - Weiye Co. won a construction project worth approximately 522 million yuan [31] - Fosun Pharma's subsidiary signed a licensing agreement for a drug targeting Alzheimer's disease [32] - Huafeng Aluminum plans to sign a raw material purchase contract with Yulin New Materials, with an estimated total amount exceeding 7.2 billion yuan [33] Shareholding Changes - Suneng Co. plans to reduce its stake by up to 1% [34] - Shengyang Technology's shareholder plans to reduce its stake by up to 1% [35] - Jingquan Hua's shareholder plans to reduce its stake by up to 1% [36] - Tigermed plans to reduce its stake by up to 3% [38] Financing Activities - Huhua Co. plans to raise no more than 586 million yuan through a private placement for various projects [39]

Core Points - Zhejiang Jiaao Environmental Protection Technology Co., Ltd. (referred to as "Jiaao Environmental") is planning to increase capital and introduce investors through its subsidiary Lianyungang Jiaao New Energy Co., Ltd. (referred to as "Lianyungang Jiaao") [1] - China Aviation Oil Group Investment Co., Ltd. (referred to as "China Aviation Oil") intends to invest 261,444,444 RMB to acquire new registered capital of the target company [1][6] - After the capital increase, the registered capital of the target company will rise from 2,353,000,000 RMB to 2,614,444,444 RMB [2][6] Summary by Sections Capital Increase Details - The existing shareholders of the target company will waive their preemptive rights for this capital increase, which is in compliance with relevant laws and regulations [2][5] - The capital increase aims to enhance the capital strength of the target company and promote the development of new projects [5] Shareholding Structure Post-Investment - After the capital increase, the shareholding structure will change, with Jiaao Environmental's stake decreasing from 39.10% to 35.19%, and China Aviation Oil acquiring a 10% stake [7] - The updated shareholding percentages post-capital increase are as follows: - Jiaao Environmental: 35.19% - Jiaao Fund: 22.95% - Jiaao Green: 18.36% - BP Global Investments: 13.50% - China Aviation Oil: 10.00% [7] Approval and Compliance - The capital increase has been approved by the sixth board of directors of the company and does not require submission to the shareholders' meeting for further approval [4][8] - This capital increase does not constitute a major asset restructuring as defined by the relevant regulations [3][8] Company and Financial Information - Lianyungang Jiaao has total assets of 404,225.53 million RMB and total liabilities of 281,983.61 million RMB as of March 31, 2025 [11] - The company reported a net profit of 167.66 million RMB for the same period [11]

Core Insights - The third China International Supply Chain Promotion Expo concluded with 102 companies signing intentions for the next expo, indicating strong interest in China's market and supply chain collaboration [2] - Honeywell emphasizes its commitment to China as a core engine for innovation and development, showcasing its local R&D efforts at the expo [2][3] Company Highlights - Honeywell's sustainable aviation fuel (SAF) solution is crucial for the sustainable development of the aviation industry, which is a significant part of the modern supply chain [3] - The SAF can reduce greenhouse gas (GHG) emissions by up to 80% compared to fossil fuels, and Honeywell has been a pioneer in commercializing SAF since 2016 [3][4] - The current market demand for aviation fuel is approximately 400 million tons per day, and if 25% is replaced with SAF, it could represent a trillion-dollar industry [4]

Investment Rating - The investment rating for the company is upgraded to "Buy" with a target price indicating a potential return of over 20% within the next six months [7][19]. Core Insights - The company is expected to achieve significant growth in its financial performance, with a forecasted net profit of 0.4-0.45 billion yuan for the first half of 2025, representing an increase of 214.28%-228.56% year-on-year [1][2]. - The increase in demand for Sustainable Aviation Fuel (SAF) is driving up the price of Used Cooking Oil (UCO), which is a key raw material for the company [3][4]. - The company has a strong order book, with many well-known domestic and international biofuel companies inquiring about orders, indicating robust market demand [4]. Financial Performance - For Q1 2025, the company reported a net profit of 0.28 billion yuan, a year-on-year increase of 222.23%. The projected net profit for Q2 2025 is estimated to be between 0.12-0.17 billion yuan, marking a turnaround from a loss of 0.44 billion yuan in the same period last year [2]. - The company's revenue projections for 2025-2027 are 14.11 billion yuan, 16.51 billion yuan, and 18.88 billion yuan, respectively, with a year-on-year growth of -2.62%, 17%, and 14.36% [4][6]. - The forecasted net profit for 2025 is 1.00 billion yuan, with significant growth rates of 668.27%, 57.94%, and 39.45% for the following years [4][6]. Market Dynamics - The demand for SAF is expected to increase significantly due to new regulations in the EU and UK, which will require a 2% blending of SAF starting January 2025, potentially leading to an additional demand of approximately 1.8 million tons of UCO [3]. - The Chinese government is actively supporting the development of biofuels, which is expected to further boost domestic SAF demand during the 14th Five-Year Plan period [3][4].

1. Report Industry Investment Ratings No industry investment ratings are provided in the report. 2. Core Views - Palm oil: The fundamental contradictions are not obvious, and it is greatly affected by international oil prices [2][4]. - Soybean oil: There is insufficient speculation on US soybean weather, lacking driving forces [2][4]. - Soybean meal: Due to trade concerns and the decline of US soybeans, Dalian soybean meal may fluctuate weakly [2][15]. - Soybean: Affected by the weak atmosphere in the surrounding market, the market may fluctuate weakly [2][15]. - Corn: It will fluctuate weakly [2][18]. - Sugar: It will be range - bound [2][21]. - Cotton: Attention should be paid to US tariff policies and their impacts [2][24]. - Eggs: The expectations are running ahead, and the reality is following [2][28]. - Live pigs: Attention should be paid to the sentiment of the new round of speculative realization [2][30]. - Peanuts: There is support at the bottom [2][35]. 3. Summary by Related Catalogs 3.1 Palm Oil, Soybean Oil, and Rapeseed Oil - **Fundamental Data**: Palm oil's daily - session closing price was 8,466 yuan/ton with a - 0.07% change, and the night - session closing price was 8,482 yuan/ton with a 0.19% change. Soybean oil's daily - session closing price was 7,894 yuan/ton with a - 0.63% change, and the night - session closing price was 7,870 yuan/ton with a - 0.30% change. Rapeseed oil's daily - session closing price was 9,548 yuan/ton with a - 0.61% change, and the night - session closing price was 9,492 yuan/ton with a - 0.59% change [4]. - **Macro and Industry News**: From July 1 - 5, Malaysia's palm oil exports were 213,055 tons, a 31.59% increase from the same period last month. Indian officials called for an increase in palm oil import tariffs and a minimum guaranteed price. Up to 500 million tons of palm - based residues and biomass in Southeast Asia can be used to produce sustainable aviation fuel [5][8]. - **Trend Intensity**: The trend intensity of palm oil and soybean oil is 0 [13]. 3.2 Soybean Meal and Soybean - **Fundamental Data**: DCE soybean 2509's daily - session closing price was 4079 yuan/ton with a - 54 (- 1.31%) change, and the night - session closing price was 4073 yuan/ton with a - 18 (- 0.44%) change. DCE soybean meal 2509's daily - session closing price was 2937 yuan/ton with a - 25 (- 0.84%) change, and the night - session closing price was 2933 yuan/ton with a - 15 (- 0.51%) change [15]. - **Macro and Industry News**: As of July 6, 2025, the good - to - excellent rate of US soybeans was 66%, the same as expected and the previous week, and lower than 68% in the same period last year. Brazil exported 1,917,950.97 tons of soybeans in the first week of July. Argentina will export 30,000 tons of soybean meal to China for the first time. On July 7, CBOT soybean futures closed at a two - week low due to favorable weather in the US Midwest and trade concerns [9][15][17]. - **Trend Intensity**: The trend intensity of soybean meal and soybean is - 1 (only referring to the price fluctuations of the main - contract futures on the day - session of the reporting day) [17]. 3.3 Corn - **Fundamental Data**: The closing price of C2509 was 2,326 yuan/ton with a - 1.36% change, and the night - session closing price was 2,321 yuan/ton with a - 0.21% change. The closing price of C2511 was 2,283 yuan/ton with a - 0.91% change, and the night - session closing price was 2,378 yuan/ton with a 4.16% change [18]. - **Macro and Industry News**: The northern corn collection and port prices remained stable, while the prices in Northeast China and North China mostly declined. The prices of imported sorghum and barley were also reported [19]. - **Trend Intensity**: The trend intensity of corn is 0 [20]. 3.4 Sugar - **Fundamental Data**: The raw sugar price was 16.25 cents/pound with a - 0.12 change. The mainstream spot price was 6050 yuan/ton with a - 20 change. The futures main - contract price was 5754 yuan/ton with a - 15 change [21]. - **Macro and Industry News**: Pakistan approved the import of 500,000 tons of sugar. Brazil's exports in June increased by 5% year - on - year. China imported 350,000 tons of sugar in May. CAOC estimated the domestic sugar production, consumption, and import volume for the 24/25 and 25/26 seasons. ISO estimated a global sugar supply shortage of 5.47 million tons in the 24/25 season [21][22]. - **Trend Intensity**: The trend intensity of sugar is 0 [23]. 3.5 Cotton - **Fundamental Data**: The closing price of CF2509 was 13,760 yuan/ton with a - 0.15% change, and the night - session closing price was 13720 yuan/ton with a - 0.29% change. The closing price of CY2509 was 19,955 yuan/ton with a - 0.22% change, and the night - session closing price was 19910 yuan/ton with a - 0.23% change [24]. - **Macro and Industry News**: The cotton spot trading was mostly sluggish, and the cotton yarn market was still dull. ICE cotton futures fell nearly 1% due to concerns about US tariff policies and good growth conditions of US cotton [25]. - **Trend Intensity**: The trend intensity of cotton is 0 [27]. 3.6 Eggs - **Fundamental Data**: The closing price of eggs 2508 was 3,449 yuan/500 kilograms with a - 3.74% change. The closing price of eggs 2510 was 3,360 yuan/500 kilograms with a - 1.81% change [28]. - **Trend Intensity**: The trend intensity of eggs is 0 [28]. 3.7 Live Pigs - **Fundamental Data**: The Henan spot price was 14980 yuan/ton with a - 200 change. The futures price of live pigs 2509 was 14245 yuan/ton with a - 60 change [31]. - **Market Logic**: The current market has entered the expected trading stage. The expected state reserve purchase has driven the formation of a policy - bottom sentiment. The consistent bullish expectation from July to August has driven the near - end sentiment. The spot price has continued to strengthen, and the futures market has repaired the basis. However, the futures price has offered hedging profits, increasing the game. The large number of piglets sold by group farms in the first quarter will start to be slaughtered in July. Attention should be paid to the subsequent spot performance. The support level of the LH2509 contract is 13,000 yuan/ton, and the resistance level is 14,500 yuan/ton [33]. - **Trend Intensity**: The trend intensity of live pigs is 0 [32]. 3.8 Peanuts - **Fundamental Data**: The price of Liaoning 308 common peanuts was 9,000 yuan/ton with a - 100 change. The closing price of PK510 was 8,098 yuan/ton with a - 1.46% change [35]. - **Spot Market Focus**: The remaining peanuts in the production areas are almost exhausted, and most are selling inventory. The prices in some white - sand peanut production areas are weakly stable, and the prices in large - peanut production areas are stable [36]. - **Trend Intensity**: The trend intensity of peanuts is 0 [37].

1. Report Industry Investment Ratings No investment ratings are provided in the reports. 2. Core Views of the Reports 2.1 Oils and Fats - Palm oil: With the release of MPOA production data and potential inventory decline at the end of the month, crude palm oil futures may break through previous highs. However, due to the expected seasonal increase in July production, beware of the risk of price pull - back around the MPOB report. The domestic Dalian palm oil futures market may continue to rise in the short - term [1]. - Soybean oil: The US Senate passed a fiscal spending bill including 45Z tax credits, which is expected to boost soybean oil consumption if passed by the House and signed by the President. Domestically, high factory operating rates have increased inventory, but the selling pressure on oil mills is not large, and the decline is expected to be limited [1]. 2.2 Corn - The current corn price is stable but lacks upward momentum due to continuous import auctions. In the medium - term, supply is tight, imports are low, and consumption is increasing, which may support price increases. Short - term operations are recommended, paying attention to policy auctions [3][5]. 2.3 Meal - US soybeans have strengthened technical support and rebounded. Brazilian soybean prices are rising. Currently, domestic soybean and soybean meal inventories are rising, but there is no significant inventory pressure on soybean meal. The supply is expected to be high, and attention should be paid to demand [6]. 2.4 Pork - The spot price of live pigs is oscillating strongly. The market is expected to be strong in the short - term, but the pressure on the 09 contract is increasing, and attention should be paid to the pressure above 14,500 [9]. 2.5 Sugar - The increase in the ethanol blending ratio in Brazilian gasoline has supported the rebound of raw sugar prices, but the global supply is loose, and the rebound is limited. Domestically, the market sentiment is positive, but considering future imports, the market may turn bearish after the rebound [12]. 2.6 Cotton - The short - term supply of old - crop cotton is tight, but the long - term supply is sufficient. The downstream industry is weakening, and the demand is weak. Cotton prices are expected to fluctuate within a range [14]. 2.7 Eggs - The supply of eggs is sufficient, demand is average, and downstream procurement is cautious. Egg prices are expected to be stable first, decline slightly in the short - term, and then stabilize [15]. 3. Summary by Related Catalogs 3.1 Oils and Fats - **Prices**: On July 3, the spot price of Jiangsu first - grade soybean oil was 8,290 yuan/ton, up 0.36% from the previous day; the futures price of Y2509 was 7,994 yuan/ton, down 0.30%. The spot price of Guangdong 24 - degree palm oil was 8,560 yuan/ton, up 1.18%; the futures price of P2509 was 8,478 yuan/ton, up 0.45%. The spot price of Jiangsu fourth - grade rapeseed oil was 9,830 yuan/ton, up 1.03%; the futures price of O1509 was 9,618 yuan/ton, unchanged [1]. - **Spreads**: The soybean oil 09 - 01 spread was 20 yuan/ton, down 54.55%; the palm oil 09 - 01 spread was 0 yuan/ton, up 100.00%; the rapeseed oil 09 - 01 spread was 65 yuan/ton, up 6.15% [1]. 3.2 Corn - **Prices**: On July 3, the futures price of corn 2509 was 2,363 yuan/ton, unchanged; the futures price of corn starch 2509 was 2,731 yuan/ton, unchanged [3]. - **Market situation**: In the Northeast, the remaining grain is scarce, and prices are firm; in North China, the shipment volume has increased slightly, and deep - processing prices are stable with partial declines. The overall demand is resilient, but wheat substitution limits price increases [3]. 3.3 Meal - **Prices**: On July 3, the spot price of Jiangsu soybean meal was 2,840 yuan/ton, unchanged; the futures price of M2509 was 2,958 yuan/ton, up 0.48%. The spot price of Jiangsu rapeseed meal was 2,500 yuan/ton, up 1.21%; the futures price of RM2509 was 2,601 yuan/ton, up 0.89% [6]. - **Market situation**: US soybean prices have rebounded, and Brazilian soybean prices are rising. Domestic soybean and soybean meal inventories are rising, and the supply is expected to be high [6]. 3.4 Pork - **Prices**: On July 3, the futures price of the main live - pig contract was 830 yuan/ton, up 9.21%. The spot price in Henan was 15,200 yuan/ton, up 100 yuan/ton [9]. - **Market situation**: The inventory of secondary - fattened pigs is increasing, the slaughter procurement is more difficult, and the spot price is rising. The market sentiment is positive in the short - term, but the pressure on the 09 contract is increasing [9]. 3.5 Sugar - **Prices**: On July 3, the futures price of sugar 2601 was 5,576 yuan/ton, down 0.07%; the futures price of sugar 2509 was 5,767 yuan/ton, up 0.02%. The ICE raw sugar main contract was 16.37 cents/pound, up 5.21% [12]. - **Industry situation**: The national sugar production and sales have increased year - on - year, and the inventory has decreased [12]. 3.6 Cotton - **Prices**: On July 3, the futures price of cotton 2509 was 13,785 yuan/ton, down 0.14%; the futures price of cotton 2601 was 13,785 yuan/ton, down 0.25%. The ICE US cotton main contract was 68.43 cents/pound, down 0.31% [14]. - **Industry situation**: The inventory in the north is decreasing, the industrial inventory is slightly down, and the import volume has decreased. The downstream inventory is increasing, and the processing profit is decreasing [14]. 3.7 Eggs - **Prices**: On July 3, the futures price of the egg 09 contract was 3,690 yuan/500KG, up 0.33%; the futures price of the egg 08 contract was 3,565 yuan/500KG, up 0.59%. The egg - producing area price was 2.60 yuan/jin, unchanged [15]. - **Market situation**: The supply of eggs is sufficient, demand is average, and prices are expected to be stable with a slight decline in the short - term [15].

Core Insights - The report highlights the significant increase in demand for sustainable aviation fuel (SAF) due to the European Union's proposed subsidies, which could enhance SAF procurement by airlines [5][6] - The establishment of a new subsidiary by the company in Shandong is aimed at improving market access and service efficiency, indicating a strategic expansion in response to regional demand [7] Market Performance - The new materials sector saw a weekly increase of 5.12%, with specific sub-sectors like battery chemicals rising by 9.13% and semiconductor materials by 4.09% [5] - The report provides a detailed weekly price tracking of various chemical raw materials, indicating stability in prices for several products while noting slight declines in vitamins [5] Investment Recommendations - The report suggests focusing on companies like Jiaao Environmental Protection and Zhuoyue New Energy, which are positioned to benefit from the rising SAF demand and have ongoing projects in biofuels [5][6] - The company is projected to achieve significant revenue growth from 2025 to 2027, with expected revenues of 10.55 billion, 12.85 billion, and 15.39 billion yuan, reflecting a compound annual growth rate of approximately 21.8% [7]

Summary of Conference Call on UCO Industry and Company Insights Industry Overview - The UCO (Used Cooking Oil) market is driven by carbon attributes and green premiums, with prices currently around 7,700-7,800 RMB/ton, reflecting a 500-600 RMB increase since early June [2][5][25] - The market dynamics have shifted due to mandatory bio-jet fuel (SAF) blending policies in Europe and the commissioning of large domestic plants, enhancing the bargaining power of domestic producers [2][5] - The annual production of UCO from regulated kitchen waste treatment plants in China is approximately 800,000 to 900,000 tons, with slow capacity expansion due to strict project approvals [2][3][8] Company Positioning - The company specializes in kitchen organic waste treatment and UCO resource utilization, processing about 4,700-4,800 tons of waste daily with a design capacity of 5,400 tons, achieving an 88% utilization rate [3] - The company’s UCO production is around 90,000 tons annually, positioning it as a leader in the domestic UCO sector [3] Market Dynamics - UCO pricing has been influenced by the European SAF blending mandate, which requires a 2% addition by 2025, leading to increased domestic demand [5][17] - The company’s UCO sales have transitioned from international clients to domestic SAF producers, with major clients including Hai Xin Neng Ke and He Nan Jun Heng [11][12] Production and Supply Chain - UCO is categorized into several types based on quality, with the highest quality sourced from kitchen waste treatment plants, followed by mixed oils and lower-quality oils like gutter oil [9][10] - The company plans to expand its UCO production capacity to 200,000 tons annually through acquisitions and projects like "urban oil fields," targeting a daily processing capacity of 8,000 to 10,000 tons [4][15][16] Regulatory Environment - The UCO industry faces significant regulatory hurdles, with project approvals requiring local government consent and operational experience, limiting the emergence of new large-scale producers [8][9] Future Outlook - The demand for UCO is expected to grow, particularly with European policies mandating higher SAF blending ratios, which could lead to a supply shortage if domestic production does not keep pace [21][22] - The company anticipates a substantial improvement in performance in 2025, driven by cost reductions and increased oil extraction rates, with a focus on monitoring oil price fluctuations [25] Key Risks and Considerations - Oil price fluctuations significantly impact profitability, with a 1,000 RMB increase in oil prices affecting profits by approximately 90 million RMB [25] - The company is advised to keep an eye on UCO price trends and the prices of palm oil and rapeseed oil, as they are closely linked to UCO pricing [25]

Group 1: SAF Market Insights - The SAF market is transitioning to a supply-demand negotiation phase, with production capacity expansion slowing down and effective utilization rates increasing due to market price fluctuations [2] - The EU's 2025 2% SAF blending policy is expected to drive SAF demand growth, leading to potential price increases for SAF and UCO [2] - By 2025, Europe is projected to purchase 1 million tons of SAF at an estimated cost of $1.2 billion, with compliance costs potentially adding an extra $1.7 billion, effectively doubling the procurement cost for European airlines [3] Group 2: Company SAF Project Status - The company's SAF project is progressing steadily through technological upgrades, production optimization, and diversified sales channels, aligning with the company's strategic direction [4] - The SAF industry exhibits cyclical volatility, making market price fluctuations a critical factor for corporate adjustments [4] Group 3: SEED Water Treatment Technology - The SEED water treatment technology demonstrates significant competitive advantages in investment, operational costs, land use, construction time, and carbon emissions compared to traditional water treatment plants [5] - Innovations include the use of special steel structures, factory-prefabricated modules, and advanced integrated processing techniques, resulting in over 70% reduction in carbon emissions and more than 50% savings in construction time [5][6] Group 4: Market Expansion and Project Development - The company has accelerated project implementation, securing contracts in Xinjiang, Henan, and Beijing for municipal water supply and wastewater treatment, marking a significant expansion of SEED technology into the broader water sector [6] - The company aims to sign 10 new SEED-related contracts in 2025, indicating a robust order reserve and a shift from "engineering-driven" to "product-driven" approaches in the wastewater treatment industry [7]