Investment Rating - The report does not explicitly state an investment rating for the shipping and maritime industry. Core Insights - The green transformation of the shipping and maritime industry is urgent and necessary, driven by the International Maritime Organization's (IMO) greenhouse gas reduction strategy, which mandates a reduction of at least 20% by 2030 and aims for net-zero emissions by 2050 [14][22]. - The report emphasizes that the dual paths of carbon reduction technologies and green fuel alternatives are essential for achieving the industry's green transformation [25][28]. - China's shipping industry is positioned as a key player in the global transition, with a significant share of green ship orders and a robust capacity for green methanol production [26][28]. Summary by Sections 1. Research Background - The shipping industry is crucial for global trade, accounting for over 90% of international goods transport, and faces significant pressure to decarbonize due to its contribution to greenhouse gas emissions [21]. - The report highlights the need for a systematic assessment of carbon reduction technologies and green fuel alternatives to meet the IMO's targets [22][30]. 2. Carbon Reduction Technology System and Market Development Space - The shipping industry's carbon reduction efforts are evolving from isolated improvements to a comprehensive technology system that includes energy alternatives, intelligent operations, and infrastructure upgrades [35][36]. - The report outlines a multi-path approach to carbon reduction, integrating various technologies such as green fuels, electrification, and digital optimization [37][38]. 3. Research on Various Green Fuels and Their Replacement Paths - The report defines green fuels as those with significantly lower greenhouse gas emissions throughout their lifecycle compared to traditional fossil fuels, emphasizing the strategic importance of transitioning to these fuels for the shipping industry [53]. - It identifies key green fuels, including LNG, biodiesel, green methanol, green ammonia, and green hydrogen, and assesses their suitability for maritime applications [54]. 4. Development Strategies and Recommendations - The report suggests that large shipping companies should adopt green transformation strategies that align with national carbon neutrality goals and international regulations [28]. - It advocates for the establishment of a resilient and sustainable framework for the green shipping industry, emphasizing the need for collaboration across the supply chain [28].

Investment Rating - The report does not explicitly provide an investment rating for the shipping and maritime industry. Core Insights - The green transformation of the shipping and maritime industry is urgent and necessary, driven by the International Maritime Organization's (IMO) greenhouse gas reduction strategy, which mandates a reduction of at least 20% by 2030 and 70% by 2040 [21][22]. - The report emphasizes that the dual paths of carbon reduction technologies and green fuel alternatives are essential for achieving the industry's green transformation [25][28]. - China's shipping industry is positioned as a key player in the global transition, with a significant share of green ship orders and a robust capacity for green methanol production [26][28]. Summary by Sections 1. Research Background - The shipping industry is crucial for global trade, accounting for over 90% of international goods transport, and faces significant pressure to decarbonize due to its contribution to greenhouse gas emissions [21][22]. - The report highlights the need for a systematic assessment of carbon reduction technologies and green fuel alternatives to meet the IMO's targets [22][30]. 2. Ship Carbon Reduction Technology System and Market Development Space - The report outlines the transition from voluntary measures to mandatory compliance for carbon reduction in the shipping industry, driven by the IMO's strategic goals [35]. - It identifies key technological directions, including energy substitution, intelligent operations, and infrastructure upgrades, as essential for achieving carbon reduction [36][39]. - The current application of carbon reduction technologies is evolving from traditional energy efficiency improvements to innovative solutions like hydrogen and ammonia fuels [46][47]. 3. Various Green Fuels and Their Replacement Pathways - The report discusses the strategic significance of green fuel alternatives in the shipping industry, emphasizing their role in achieving the IMO's reduction targets and transforming the industry [53]. - It highlights the urgent need for green fuel alternatives to address the dual challenges of marine environmental pollution and reliance on fossil fuels [53].

1. Report Industry Investment Rating - No relevant information provided. 2. Core View of the Report - The expectation of the certainty of the biomass diesel policy is increasing, which has led to the strong upward trend of US soybean oil. If China purchases US soybeans as negotiated in 2026 and the US increases the blending volume of biomass diesel, the US soybean futures price will be bullish or even rise. The rising RIN market price in the US will boost the price of US soybean oil [1][28]. 3. Summary by Relevant Catalogs 3.1 Biomass Diesel Policy and Production - The EPA proposed renewable obligation volumes from 2023 - 2027, with the biomass diesel volume increasing from 4.51 billion RINs in 2023 to 7.5 billion RINs in 2027. The Trump administration is considering a biomass diesel usage range of 5.2 - 5.6 billion gallons, while the proposed usage is 5.6 billion gallons [5]. - Starting from 2026, the US has become a net exporter of biomass diesel. In 2026, the consumption of biodiesel and renewable diesel was 14.7 million tons, a year - on - year increase of 33%, or 3.6 million tons. In 2027, the production was 18.1 million tons, a year - on - year increase of 14%, or 2.2 million tons. The consumption was 16.8 million tons, a year - on - year increase of 14%, or 2.1 million tons [10]. 3.2 US Soybean Balance Sheet - China plans to purchase 25 million tons of soybeans from the US annually for the next three years, with a total of 87 million tons in three years. Based on a 53% proportion, the US soybean export volume in the 26/27 market year is estimated to be 1.69 billion bushels [18]. - In 2026, the total sown area of 8 major field crops in the US will slightly decrease to 247.55 million acres, a decrease of about 0.37% compared to 2025. The soybean sown area will increase to 85 million acres, a year - on - year increase of about 4.78%. The 25/26 global soybean yield per unit area reached a record high, and the US soybean yield per unit area is estimated to be 53 bushels/acre in 26/27 [20]. - The US soybean crushing industry has been expanding, with the actual domestic capacity increasing from about 2.23 billion bushels/year in early 2023 to about 2.55 billion bushels/year in early 2025, a growth of 14%. There are still expansion plans until 2030. The soybean crushing volume in 26/27 is estimated to be 2.734 billion bushels, a year - on - year increase of 6.4% [20][21]. 3.3 Price and Subsidy - The cost of US soybeans in 2026 is estimated to be between 1279 - 1339 cents/bushel [25]. - The target subsidy price of the US Price Loss Coverage in 2026 is expected to be 1171 cents/bushel, and the benchmark price of the Agriculture Risk Coverage - CO is expected to be 1076 cents/bushel. The US soybean policy direct subsidy and insurance price in 2026 are important reference prices for CBOT soybeans [26]. - Under a short - term economic assistance program, US soybean farmers will receive a subsidy of 30.88 dollars/acre, equivalent to 58 cents/bushel based on a yield of 53 bushels/acre [27]. 3.4 Relationship between RIN and US Soybean Oil Price - As the US RIN market price rises, the profit of producing renewable diesel from US soybean oil improves, which boosts the US soybean oil price. After the profit is restored, it is beneficial for the US soybean oil price to rise [28]. - Assuming the US fuel price is 2.2 dollars/gallon and the profit of producing renewable diesel from soybean oil is 1 dollar/gallon, when the RIN price is 1.23 dollars/gallon, the US soybean oil price is reasonably between 51 - 52 cents/pound; when the RIN price is 1.4 dollars/gallon, the US soybean oil price is reasonably between 54 - 55 cents/pound; when the RIN price is 1.5 dollars/gallon, the US soybean oil price is reasonably between 56 - 57 cents/pound; when the RIN price is 1.8 dollars/gallon, the US soybean oil price is reasonably between 63 - 64 cents/pound [28][30].

Group 1 - The U.S. government plans to finalize the 2026 biofuel blending quotas by early March, maintaining the initial proposal while dropping penalties on renewable fuel imports, which could lead to a significant increase in biomass diesel production [1] - Soybean oil futures surged by 3.81% following the news, while domestic vegetable oil futures also saw gains, with palm oil and soybean oil futures rising slightly [1] - The palm oil market is currently in a state of "bad news exhausted, new drivers arriving," with a focus on the potential impact of Indonesia's export tax increase on palm oil, which could enhance its competitiveness globally [2] Group 2 - Indonesia's rainy season is expected to reduce palm oil production in January and February, while strong export performance is noted, particularly with a nearly 50% year-on-year increase in exports to India [2] - The palm oil price rebound faces challenges due to higher-than-expected production in December, leading to inventory accumulation, which creates price pressure [2] - The canola oil market is primarily driven by trade policy expectations, with short-term price support from delayed imports and low inventory, but long-term supply pressures are anticipated due to improved trade relations with Canada [3] Group 3 - Domestic demand for soybean oil is strong ahead of the Spring Festival, with a forecasted decrease in soybean imports in the first quarter, supporting short-term prices [3] - The international soybean market lacks new developments, but domestic soybean oil inventories have dropped to a five-month low, providing a solid price floor [3] - Future market dynamics will focus on the speed of inventory reduction for palm oil and the balance between tight supply and policy expectations for canola oil, with potential for trend-driven movements [4]

Report Industry Investment Rating - Oil prices are expected to fluctuate weakly, with a medium - term short - position allocation [3] Core Viewpoints - Trump's threat to ban imports of Chinese UCO is unlikely to have a significant impact on US biodiesel production. The adjustment of the tax credit policy in 2025 has significantly reduced the import volume of Chinese UCO. From January to July this year, US imports of Chinese UCO decreased by 43% year - on - year. Due to the US bonded area policy, some imports of Chinese UCO will continue. The reduction in US biomass diesel production will increase US petroleum diesel demand by 130,000 barrels per day in 2025 and about 80,000 barrels per day in 2026 [2] Market News and Important Data - The price of light crude oil futures for November delivery on the New York Mercantile Exchange fell 43 cents to $58.27 per barrel, a decline of 0.73%. The price of Brent crude oil futures for December delivery in London fell 48 cents to $61.91 per barrel, a decline of 0.77%. The SC crude oil main contract closed down 0.70% at 440 yuan per barrel [1] - As of the week ending October 13, the total refined oil inventory at the Fujairah Port in the UAE was 17.812 million barrels, an increase of 1.478 million barrels from the previous week. Light distillate inventories increased by 623,000 barrels to 8.73 million barrels, medium distillate inventories increased by 640,000 barrels to 2.947 million barrels, and heavy residual fuel oil inventories increased by 215,000 barrels to 6.135 million barrels [1] - Russian Deputy Prime Minister Alexander Novak said that global energy demand is growing, Russia has the potential to further increase oil production, but currently has no plan to submit an oil production compensation plan to OPEC. Geopolitical tensions, sanctions, and trade wars pose risks to energy supply [1] - UK Chancellor of the Exchequer Reeves will impose targeted sanctions on two Russian oil companies, Lukoil and Rosneft [1] - Russian Deputy Prime Minister Novak told the Saudi energy minister that joint actions within the framework of OPEC+ are in the long - term national interests of both countries and will strongly promote the economic development of both countries [1] Investment Logic - Trump's threat to ban imports of Chinese UCO is unlikely to have a major impact on US biodiesel production. The 2025 tax credit policy adjustment has reduced Chinese UCO imports. From January to July, US imports of Chinese UCO decreased by 43% year - on - year. Some imports will continue due to the bonded area policy. US petroleum diesel demand will increase by 130,000 barrels per day in 2025 and about 80,000 barrels per day in 2026 [2] Strategy - Oil prices are expected to fluctuate weakly, with a medium - term short - position allocation [3] Risks - Downside risks: The US relaxes sanctions on Russian oil, and there are macro black - swan events [3] - Upside risks: The US tightens sanctions on Russian oil, and large - scale supply disruptions occur due to conflicts in the Middle East [3]

Report Industry Investment Rating No relevant content provided. Core View of the Report - The US EPA issued a proposed rule for the RFS from 2026 - 2027, which is unexpectedly bullish. The total demand for raw materials is expected to grow in the next two years [20]. - There is a price premium for North American domestic raw materials over overseas raw materials in producing renewable diesel. The premium is dynamic and may widen if the RIN price rises. The bottom of the US soybean oil price is relatively stable, but there is a risk of a 10% - 20% upward fluctuation in the long - term. The demand from small refineries is uncertain [20]. - Due to the increasing biomass diesel obligation and differential subsidies for domestic and foreign raw materials, North American soybean oil and rapeseed oil will be used for biomass diesel production, while overseas raw materials will be used in the food and oleochemical markets. The price of raw materials for biomass diesel is more elastic [21]. - The US is expected to increase domestic soybean crushing and reduce soybean exports without increasing the soybean planting area. This may affect China's soybean imports, and the CBOT soybean price will be supported [22]. Summary by Related Catalogs Policy Introduction - On June 13, 2025, the US EPA issued a proposed rule for the RFS from 2026 - 2027, which led to a sharp rise in US soybean oil prices. A virtual public hearing will be held on July 8, 2025, and an additional meeting may be held on July 9, 2025 [2]. - The policy aims to provide market certainty for producers, offer lower oil prices for consumers, support the US biofuel industry, and enhance energy security and employment [3]. - The main contents of the policy include setting strong growth targets for major renewable fuels, prioritizing the US by reducing the value of foreign renewable fuels and raw materials, and canceling electricity as a qualified renewable fuel to achieve the goal of canceling the EV mandate [3]. Policy Details - The EPA proposed to set the total RV0 for 2026 at 24.02 billion RINs, an almost 8% increase from 2025, and 24.46 billion RINs for 2027, a nearly 2% increase from the previous year [5]. - The obligated quantities of biomass diesel for 2026 and 2027 are set at 5.61 billion gallons and 5.86 billion gallons respectively, exceeding market expectations [6]. - The proposed policy will increase the production of US biomass diesel, raise the operating rate, and increase the demand for raw materials [6]. Impact on Raw Material Prices and Demand - North American domestic raw materials for renewable diesel have a premium of about 10 cents per pound (about $220 per ton) over overseas raw materials. The premium is dynamic and may widen if the RIN price rises. The US soybean oil price is more volatile, and there is a risk of a 10% - 20% upward fluctuation in the long - term. The demand from small refineries is uncertain [10]. - The increasing biomass diesel obligation and differential subsidies will lead to the use of North American soybean oil and rapeseed oil for biomass diesel production, while overseas raw materials will be used in the food and oleochemical markets. The price of raw materials for biomass diesel is higher than that in other industries [11]. - Compared with 2024, the total demand for biomass diesel in 2026 is flat, and it increases in 2027. The global demand for vegetable oil is expected to increase, with North America leading the growth [13][14]. - The US may increase domestic soybean crushing and reduce soybean exports without increasing the soybean planting area. The USDA expects the 2025/26 soybean crushing volume to be 2.49 billion bushels (67.76 million tons), a 2.8% increase year - on - year. The domestic soybean crushing capacity has increased, and there is a probability of further increase by 2030. This may affect China's soybean imports, and the CBOT soybean price will be supported [18][22].

Group 1: Report Industry Investment Rating - No relevant content provided Group 2: Core Viewpoints of the Report - The total demand for biomass diesel in the US shows an increasing trend, with stable demand in the early stage and growth in the later stage. From 2026 to 2027, compared with 2024, the demand will increase by 13.28% and 18.33% respectively, and the total raw material demand will increase by 232 and 320 million tons respectively [1][8] - The growth in demand for biomass diesel will lead to an increase in the use of North American rapeseed oil and soybean oil, and the North American market will be stronger than overseas markets [1][2] - The actual production performance needs to be monitored to dynamically evaluate the impact of RIN obligations set by the EPA for 2026 and 2027 [9] Group 3: Summary by Relevant Catalogs 1. Biomass Diesel Obligation and Demand Trends - The biomass diesel obligation volumes in 2026 and 2027 are 5610 and 5860 million gallons respectively. Compared with the 4952 million gallons (domestic production + net imports) in 2024, they will increase by 13.28% and 18.33% respectively [8] - The total raw material demand in 2026 and 2027 will increase by 232 and 320 million tons respectively compared with 2024 [8] 2. Raw Material Sources and Substitution - In 2024, vegetable oils were mainly sourced from North American local raw materials, while animal fats and yellow greases also had raw materials from other regions. The total raw materials from other regions for beef tallow and yellow greases were 286 million tons [1][2] - Assuming that non - North American and imported raw materials are replaced by North American local raw materials, the demand in 2024 is estimated to be 319 million tons, accounting for nearly 40% of the edible demand [7] 3. Import and Export of Biomass Diesel and Raw Material Conversion - In 2024, the net imports of biodiesel + renewable diesel in the US converted into total raw materials were 33 million tons [5] - The net imports of biodiesel and renewable diesel in 2024 were 89 and - 55 million tons respectively, with a total net import of 33 million tons [5] 4. Consumption of Vegetable Oils - The industrial and edible consumption of rapeseed oil and soybean oil in the US from 2022/2023 to 2025/2026 is provided, and the total edible consumption of rapeseed oil and soybean oil is in the range of 8406 - 8669 million tons [8]