At present, the leading pig breeding enterprises such as Muyuan Co., Ltd. (002714), New Hope (000876), and Zhengbang Technology (002157) have successively announced their performance forecasts for the first half of 2022.
But “Second Senior Brother” seems to be back. After more than a year of continuous downturn, the price of live pigs has rebounded significantly since July. Recently, the spokesperson of the National Bureau of Statistics pointed out that the current production capacity of live pigs has generally returned to normal levels, and the price does not have the basis for a sharp increase. On the other hand, the stock of live pigs remained stable, and the production capacity of reproductive sows was in a normal and reasonable range. In July, pig farming turned losses into profits. At the same time, the market still had great differences in the trend of pig prices in the later period.
The total net profit of 9 pig companies lost more than 13.9 billion yuan
As of July 19, with the exception of Wen’s Co., Ltd., which has not yet announced its performance forecast, the remaining 9 major A-share listed pig breeding companies have all released interim report estimates.
According to the statistics of Oriental Fortune Choice, among the 9 listed companies that have disclosed the 2022 interim report performance forecast, Muyuan, New Hope, Zhengbang Technology, Luoniushan, Dongrui, Xinwufeng, Superstar Agriculture and Animal Husbandry, Shennong Group, etc. 8 All listed companies have pre-losses, and only Tianbang Foods has turned losses into wins; in general, the minimum net profit pre-loss reported by these 9 pig breeding companies is 13.945 billion yuan in total; while the maximum net profit pre-loss is 158.17 billion.
Looking further, on the evening of July 14, the “Pigma” Muyuan shares disclosed the performance forecast in the interim report, showing that during the reporting period, the number of live pigs to slaughter increased significantly year-on-year, while the price of live pigs dropped significantly year-on-year, resulting in the operating performance of Muyuan shares in the first half of 2022. A significant year-on-year decrease, the first time a loss occurred. Muyuan Co., Ltd. estimates that the net profit loss in the first half of 2022 is 6.3 billion to 6.9 billion yuan, a year-on-year decrease of 166.13% to 172.43%; the non-net profit loss is 7.2 billion to 7.8 billion yuan, a year-on-year decrease of 165.06% to 170.48%.
Zhengbang Technology has not had a good time. Following in the footsteps of Muyuan, the listed company expects to lose about 3.8 billion to 4.6 billion yuan in the first half of 2022, a year-on-year decrease of 165.72% to 221.66%; A year-on-year decrease of 302.57%~392.03%.
The low price of live pigs is the main reason for the loss. During the reporting period, Zhengbang Technology produced a total of 4.8452 million live pigs, a year-on-year decrease of 30.75%; the average sales price of commercial pigs was 12.74 yuan/kg, a year-on-year decrease of 37.49%, and the increase in the price of feed raw materials caused the Performance is under pressure. As a result, Zhengbang Technology also caused the phased mismatch between the existing production capacity and the scale of the slaughter due to the reduction of production, resulting in a low overall capacity utilization rate and an increase in depreciation and amortization expenses.
At the same time, New Hope continues to show huge losses. It is estimated that the net profit loss in the first half of 2022 will be 3.9 billion to 4.2 billion yuan, compared with a loss of 3.415 billion yuan in the same period last year. Compared with the same period in 2021, during the reporting period, the sales price of New Hope’s live pigs dropped significantly, with 6.8482 million live pigs sold, a year-on-year increase of 53.51%. The increase in sales and the decrease in sales prices led to losses in the New Hope pig industry.
It should be pointed out that although Tianbang Foods has turned its net profit into a profit, its main business of raising pigs has not been immune to it. Tianbang Food announced that the net profit in the first half of this year was 580 million yuan to 650 million yuan, a year-on-year increase of 189.16% to 199.92%, and a loss of 651 million yuan in the same period last year. In fact, in the first half of 2022, Tianbang Food’s net profit turned from loss to profit, mainly contributed by the investment income of 1.394 billion yuan from the transfer of 51% equity of the subsidiary.
After the deduction, Tianbang Food’s net profit was a loss of 730 million to 800 million yuan, which was very close to last year’s loss of 784 million yuan. Tianbang Co., Ltd. said that the negative net profit was mainly due to the loss of the pig breeding business. In the first half of 2022, the overall pig price was still at a low level, while the feed price was at a high level, which brought double pressure to Tianbang Food’s pig breeding. However, from a trend perspective, with the gradual recovery of pig prices in the second quarter and the stabilization and recovery of the company’s live pig production capacity, and the improvement of efficiency, the loss in the second quarter has narrowed significantly compared with the first quarter.
On July 15, Liu Yonghao, chairman of New Hope Group, said at the group’s 40th anniversary meeting that in the past two years, there has been a lot of pressure and uncertainty in the breeding industry, the industry has endured huge challenges, and enterprises are facing various With all kinds of difficulties, New Hope Liuhe has also experienced losses that have never been seen in history. I hope that the trough of the pig cycle will end as soon as possible and move forward in a good direction as soon as possible. However, Liu Yonghao believes that enterprises cannot rely on cycles to survive, and the ability to overcome cycles and survive cycles is the essence of company operations.
Pig production has generally returned to normal levels
According to the monitoring of the Ministry of Agriculture and Rural Affairs, from July 4th to July 10th, 2022, the average purchase price of live pigs in designated pig slaughtering enterprises above designated size in the country was 22.26 yuan/kg, an increase of 13.5% month-on-month and a year-on-year increase of 30.6%. The average ex-factory price of white strips was 28.58 yuan/kg, up 13% month-on-month and 25.6% year-on-year.
On July 13, the Ministry of Agriculture and Rural Affairs held a pig production symposium in Cangzhou City, Hebei Province. It pointed out that the current pig production situation is generally stable and improving, the number of pigs in stock has remained stable, the production capacity of reproductive sows is in a normal and reasonable area, and pig breeding has turned losses. for profit.
In addition, on July 14, the main contract 2209 of live pig futures in the domestic futures market closed at 22,300 yuan/ton, while on July 12, the main contract had reached a high of 23,290 yuan/ton, the largest increase from mid-March. nearly 45%. Data from Sozhu.com shows that on July 13, the average price of domestic live pigs for slaughter surged to a recent stage high of around 22.6 yuan/kg. At present, the entire industry has completely gotten rid of losses, and the profit of each fat pig can reach about 500 yuan.
In the latest announcement of investor relations activities, Muyuan shares disclosed that the company’s complete cost of pig breeding in the second quarter has steadily decreased, and the current complete cost is slightly higher than 15.5 yuan/kg. According to rough estimates, the impact of the increase in grain prices since the beginning of last year on the company’s unit farming cost is about 1.5 yuan/kg-1.8 yuan/kg. Taking into account the influence of external factors such as the rapid rise in raw material prices, the company’s cost target in 2022 is to achieve a complete cost of 14.5 yuan/kg-15 yuan/kg in stages.
During the research and interview process, a relevant person in charge of the pig fattening terminal in Yanting, Mianyang revealed that the pig industry had suffered losses for too long in the early stage, and many types of pig farms had withdrawn from the market, resulting in some fattening bases being vacant. With the gradual recovery of the market, some farmers have demand for supplementary pens, and there are insufficient piglets in the market.
According to data from the National Bureau of Statistics, in the second quarter, the output of pork, beef, mutton and poultry increased by 1.6% year-on-year, of which pork increased by 2.4%. At the end of the second quarter, the number of live pigs was 430.57 million, a year-on-year decrease of 1.9%, of which 42.77 million were breeding sows; 365.87 million live pigs were sold, an increase of 8.4%.
However, it should also be noted that on July 15, the spokesperson of the National Bureau of Statistics pointed out when answering a reporter’s question about the operation of the national economy in the first half of 2022, whether the increase in pork prices that everyone is concerned about will affect the overall increase in the CPI. The impact is limited. At present, the overall production capacity of live pigs has returned to normal levels, and prices do not have the basis for a sharp rise. In the early stage, the big pigs will be released one after another, which is conducive to increasing the supply of pork. In addition, relevant departments will strengthen market regulation and stabilize the relationship between supply and demand, which will promote the smooth operation of prices.
The spokesperson further pointed out that in the next stage, after entering the flood season, the supply of fresh commodities in some areas may be affected to a certain extent, and the influence of international imported factors may continue. The efforts to stabilize prices are increasing, and prices are expected to maintain a moderate upward trend.
According to the latest report of the Ruida Futures Research Institute, the main factor affecting the price of live pigs is still the influence of supply and demand. According to the statistics of 123 designated sample enterprises of Mysteel agricultural products, in June, the number of breeding sows in stock was 4.7188 million, an increase of 1.94% month-on-month and a decrease of 11.49% year-on-year; the stock of commercial pigs in June was 28.5398 million head, an increase of 0.62% month-on-month , an increase of 1.4% year-on-year. Therefore, in the context of poor performance on the consumer side, it is difficult for pig prices to improve.
Galaxy Securities believes that the pig price is at a high stage, and the pig price is expected to be better in the third quarter, but at the same time, the market has great differences in the later stage of the pig price trend.
The research report of Founder Securities pointed out that the production capacity reduction of pig breeding may exceed expectations, and the results of production capacity reduction will gradually be realized in the second half of the year. Judging from the data of all parties that can reproduce sows, except the Ministry of Agriculture and Rural Affairs, which is 8.5%, the production capacity of other parties is between 15% and 20%. Even the top listed pig companies have reduced production capacity to varying degrees. Sow feed is an a priori indicator. According to data from the Feed Industry Association, its sales in the first quarter fell by 22% year-on-year; for listed companies, Tangrenshen’s sow feed sales fell by 31% in the first quarter.Return to Sohu, see more
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