Jiaoyue trainee reporter Wang Jingru
On April 7, Dawnrays announced that in March, the company’s average sales price of commercial pigs was 17.33 yuan/kg, a month-on-month decrease of 12.48%. Up to now, a number of pig breeding companies, including Muyuan and Wen’s shares, have disclosed sales data for March. The data shows that the number of live pigs sold by the above-mentioned breeding enterprises increased significantly in March, and the decline in live pig prices gradually narrowed month-on-month.
Zhu Zengyong, a researcher at the Beijing Institute of Animal Husbandry and Veterinary Medicine of the Chinese Academy of Agricultural Sciences, believes that the current national pig production and supply is sufficient, but the demand is shrinking, and the periodic surplus is more obvious. It is expected that after June this year, the oversupply of commercial pigs is expected to ease, pork supply and demand will turn to a basic balance, and pig prices will rebound seasonally.
Pig price decline narrowed month-on-month
In the first quarter of this year, pig prices still showed a downward trend, but they slowed down significantly in March.
According to the announcement, the average selling price of wool pigs of Wen’s shares in March was 12.17 yuan/kg, down 3.03% month-on-month and 53.55% year-on-year. In contrast, the average sales price of wool pigs in January and February fell by 13.08% and 10.93%, respectively; in March, the company sold 1,448,400 pigs (including wool pigs and fresh products), a year-on-year increase of 143.63%; revenue was 2.106 billion Yuan, a year-on-year increase of 14.33%.
Wen’s Co., Ltd. said that in March, the company’s average selling price of pork hogs decreased year-on-year, mainly due to changes in the domestic live hog market. The sales volume of meat pigs increased year-on-year, mainly due to the increase in the company’s investment in seedlings and the improvement of production performance.
Muyuan Co., Ltd. said that in March, the company’s commodity pig prices showed a downward trend. In March, the company’s average selling price of commercial pigs was 11.67 yuan/kg, down 5.74% from January to February; the company sold 5.986 million live pigs (including 527,000 piglets), with a sales income of 7.432 billion yuan.
Xu Xueping, a live pig analyst at the Agricultural Products Division of Shanghai Ganglian, said in an interview with a reporter from Securities Daily, “The overall supply of live pigs in the first quarter still exceeded demand. Especially after the Spring Festival, the demand has entered a low season, and the contradiction between supply and demand has increased; The decline in pig prices slowed down in March due to factors such as the launch of policies for purchasing and storage, the strengthening of health prevention and control, and the storage of some frozen products.”
He further analyzed that in the first ten days of March, the country carried out two batches of purchase and storage of 40,000 tons and 38,000 tons respectively. Although the number of policy purchases and storage is limited, it has played a certain role in stabilizing the market mentality, and the low price resistance mentality of the breeding end has been strengthened; In addition, due to the “mask incident” in many parts of the country in March, the pressure on the supply of live pigs has slightly eased; at the same time, as the price of pigs continues to decline, some slaughtering companies in the Northeast and other regions have flexibly stored frozen products at low prices, and their enthusiasm for collecting pigs has increased. The price has some support.
Hog farming sector shares rise
It is worth noting that, in contrast to the sluggish hog market, the stock prices of hog farming-related stocks have risen since the end of the third quarter of last year, and have gone up against the backdrop of market adjustments at the end of the year and the beginning of the year. The data shows that as of the close of April 7, according to the Shenwan industry classification, within 6 months, a total of 7 stock prices of 10 hog breeding and pig enterprises have risen. The stock prices of Ng Fung, Wen’s and Tianbang all rose by more than 40%, 57.73%, 47.82% and 42.95% respectively; the stock price of Muyuan shares rose by 4.26%.
In this regard, Xu Xueping believes, “This is related to the market’s expectation that the pig cycle will reverse soon. As the contradiction of overcapacity of pigs is alleviated, pig breeding enterprises are expected to gradually get out of the predicament of loss, and promote some capital to buy bottoms and deploy high-quality breeding enterprises. Therefore, pigs There has been a strong rebound in the aquaculture sector.”
According to Mysteel’s monitoring, as of the end of February 2022, the number of reproductive sows in the stock dropped to 42.68 million after 8 months of capacity reduction, a cumulative decrease of 2.96 million or 6.49% from the high point. At the end of February, the production capacity dropped to normal holdings The level of 104%, the production capacity of live pigs has entered the green range from obvious excess.
However, there are still differences in the market regarding the specific inflection point of the pig cycle. Xu Xueping believes that the reversal of the hog cycle depends on supply and demand conditions. The pressure on the supply side is expected to ease in the second and third quarters, and the price of live pigs may rebound to some extent at the bottom, but the demand for live pigs is in the off-season, and it is difficult to have a substantial reversal. It is expected that after October, with the gradual improvement of downstream demand, the hog market may show a staged turning point.
Zhu Danpeng, a senior researcher and food industry analyst at China Brand Research Institute, told the “Securities Daily” reporter: “From an overall point of view, with the precision, scientific and rationalization of the inventory, the price of live pigs in the second half of the year is expected to show a steady rise and a slight increase. development.”
(Editor: Wen Jing)