Public Funds "Planting Seeds" in Agricultural Track: ETFs Become Important Layout Tool

Our reporter, Fang Lingchen

The enthusiasm for non-ferrous metals and oil & gas remains strong, while the agricultural sector is quietly heating up again. Since March, public fund institutions have been using ETFs (Exchange-Traded Funds) as their core tool, with product applications and launches progressing simultaneously, accelerating the “seeding” of the agricultural sector. In addition to comprehensive agricultural fields, public funds are also expanding into sub-sectors such as grains, livestock, and aquaculture.

Regarding product applications, according to data from the China Securities Regulatory Commission’s official website, as of March 17, when this report was published, nine public fund institutions had applied for a total of 11 agricultural-themed funds this month, including 8 ETFs. Among those deploying agricultural ETFs, several are leading public fund companies. For example, on March 4, Penghua Fund applied for the Penghua CSI Agricultural Theme ETF; on March 6, Huaxia Fund applied for the Huaxia CSI Livestock & Aquaculture ETF; on March 11, Bosera Fund applied for the Bosera National Food Industry ETF; and on March 13, Guotai Fund applied for the Guotai National Food Industry ETF.

In terms of product launches, there has been continuous activity. Currently, Huatai-PineBridge CSI Livestock & Aquaculture Industry ETF and Southern Fund’s CSI All-Index Agriculture, Forestry, Animal Husbandry, and Fishery ETF are in the process of issuance. GF Fund’s CSI Livestock & Aquaculture Industry ETF has completed fundraising and is awaiting establishment. Two products, Harvest Fund’s CSI Livestock & Aquaculture Industry ETF and Invesco Great Wall’s Agriculture, Forestry, Animal Husbandry, and Fishery ETF, both established on March 11, with fundraising scales of 426 million yuan and 781 million yuan respectively, will be officially listed and traded on March 20.

“Long-term, the agricultural industry may be undergoing profound changes,” said a representative from Yinhua Fund. The strengthening of upstream resource prices such as fertilizers and energy, along with geopolitical conflicts disrupting supply chains, have directly increased production costs for some agricultural products and the prices of substitutes. The systemic rise in production costs across the entire industry chain will push the marginal costs of planting and breeding upward, providing long-term price support from the cost side.

“With the increasing number of agricultural ETFs in the future, public fund institutions need to deeply explore niche sectors like breeding and grains, to create differentiated advantages and avoid homogeneous competition,” said Guan Xiaomin, a researcher at Beijing GeShang FuXin Fund Sales Co., Ltd., to Securities Daily.

In recent years, China’s index investment has flourished. The ETF market shows a clear trend of “overall growth combined with diversification.” While scale and quantity are expanding simultaneously, public funds are increasingly refining their ETF strategies, continuously enriching and optimizing product systems, and steadily advancing index investing from “popularization” to “quality improvement.”

Guan Xiaomin believes that the ETF market has entered a rapid development stage, with scale and product numbers growing in tandem. ETFs now cover multiple asset classes and have become an important vehicle for medium- and long-term capital entry. The continuous diversification of products also provides investors with low-cost, efficient investment tools and diversified asset allocation options.

According to Wind Information, as of March 17, 2026, the number of ETFs reached 1,456, with a total scale of 5.26 trillion yuan, representing an increase of 407 ETFs and 1.47 trillion yuan since the end of 2024, with growth rates of 38.8% and 38.65%, respectively.

Public fund institutions are extending their ETF strategies from traditional broad-based funds to more diverse categories, continuously enriching niche fields. For example, within stock ETFs, theme indices, size indices, industry indices, strategy indices, and style indices have all seen comprehensive expansion.

As ETFs have become an important tool for asset allocation, Guan Xiaomin reminds that “ordinary investors participating in ETF investments should also pay attention to the volatility characteristics of some industry-themed ETFs, and reasonably control their allocation ratios. Additionally, diversifying across industries at the sector level can help avoid heavy concentration in highly correlated industries.”