From the dual perspectives of industrial economics and spatial economics, this article explores the mechanism of industrial agglomeration affecting green total factor productivity and the relationship between green total factor productivity and high-quality development of grain. The GML index, the dynamic panel models and mediation model are used to empirically test the effect and mechanism of agglomeration on the high-quality development of grain. It is found that the effect of industrial agglomeration on the green total factor productivity of grains is in an "inverted U" shape. Internal economies of scale, resource sharing and technology spillover are three intermediate channels for industrial agglomeration to influence green total factor productivity, and diminishing returns to scale, insufficient resource sharing and locked technology significantly inhibit the improvement of green total factor productivity. Based on the reality, the improvement of the industrial agglomeration level has promoted the development quality of China's grain continuously. However, the current level of agglomeration is far from reaching the inflection point of the "inverted U" curve, and there is still much room for using agglomeration to promote green total factor productivity. Therefore, the scale economy of agglomeration can be fully released through the intermediary mechanism of appropriate scale farming, resource sharing and technology spillover, so as to realize the sustained and steady growth of green total factor productivity, which is the basic foothold to promote the high-quality development of grain.