Zhongde Securities Co., Ltd.
Review Opinion on Beijing DaBeiNong Technology Group Co., Ltd.'s Continued Commodity Futures Hedging Business
Zhongde Securities Co., Ltd. (hereinafter referred to as "Zhongde Securities" or "Sponsor") as the sponsor for Beijing DaBeiNong Technology Group Co., Ltd. (hereinafter referred to as "DaBeiNong" or "the Company") for its private placement of A shares, has conducted a prudent review of DaBeiNong's continued commodity futures hedging business in accordance with the "Administrative Measures for Securities Issuance and Listing Sponsorship Business," the "Shenzhen Stock Exchange Stock Listing Rules," and the "Shenzhen Stock Exchange Listed Company Self-Regulatory Supervision Guidelines No. 1—Normative Operation of Main Board Listed Companies," and other relevant regulations. The details are as follows:
I. Overview of Commodity Futures Hedging Business
(I) Purpose of Transaction
In recent years, affected by macroeconomic conditions and market changes, domestic hog and feed raw material prices have experienced significant fluctuations, posing market risks to the Company's main business. To fully utilize the hedging function of the futures market, lock in the Company's raw material costs and hog sales prices, effectively hedge against risks arising from price fluctuations of upstream raw materials and inventory products, ensure the relative stability of product costs, and enhance the Company's ability to withstand raw material price volatility, thereby achieving high-quality and stable development, the Company (including its subsidiaries) intends to carry out commodity futures hedging business.