2021performanceWhether the A-share pig farming sector, which performed at the bottom of the industry, can usher in a cycle turning point this year has become the focus of the market.As of the close on February 15, exceptMuyuan sharesExcept for (002714.SZ), the top listed pig companies have disclosed the January live pig sales briefing.
On the whole, all major pig companies achieved a month-on-month and year-on-year increase in live pig sales in January, but the continuous fluctuation of pork prices caused pig companies to still face the situation of “increase in volume and decrease in price”.
At present, the peak season of pork consumption has passed, and when the demand is declining, the national pig price has dropped rapidly after the festival, and once again fell below the breakeven point of the whole industry. According to data from China Pig Network, on February 15, the price of ternary live pigs outside the country was reported at 12.57 yuan/kg, down 12.22% month-on-month and more than 60% year-on-year.
Judging from the past years, the first quarter after the Spring Festival to the second quarter is often the off-season for pork consumption, superimposed that the overall supply of live pigs is in a stage of excess, and there is still downward pressure on pig prices. At the time when the second wave of production capacity reduction is gradually starting, the “cold winter” of listed pig companies’ performance in 2022 has just begun.
The price of pigs fell to a new low this year
Due to the substantial stocking of pork before the Spring Festival, all listed pig companies achieved a month-on-year increase in live pig sales in January.
According to the sales brief, in January,new Hope(000876.SZ) sold 1,292,600 live pigs, an increase of 20.62% month-on-month and a year-on-year increase of 76.61%. The company stated that the year-on-year increase in live pig sales was mainly due to the normal release of production capacity, and the piglet investment in mid-2021 was significantly increased compared to mid-2020.
also,Wen’s shares(300498.SZ) sold 1,506,100 pork pigs (including wool pigs and fresh products), a month-on-month increase of 22.75% and a year-on-year increase of 50.01%;Zhengbang Technology(002157.SZ) sold 958,700 live pigs (including 69,800 piglets and 888,900 commercial pigs), an increase of 19.07% month-on-month and a year-on-year increase of 21.86%.
Tianbang shares(002124.SZ)’s sales of live pigs in January fell by 18.01% year-on-year and increased by 3.7% month-on-month. A total of 381,300 commercial pigs were sold (including 7,479 piglets). “Pig King”Muyuan sharesSales briefings have not been disclosed, and companies typically choose to combine January-February sales in March each year.
Although the sales of live pigs by leading pig companies have increased significantly, the decline in pig prices still drags down sales revenue. During the reporting period,Zhengbang TechnologyandTianbang sharesThe sales revenue of the company both fell month-on-month and year-on-year, and the year-on-year decline was over 60%.new HopeThe sales revenue was 1.638 billion yuan, a year-on-year decrease of 34.66% and a month-on-month increase of 6.78%.Wen’s sharesSales revenue fell by nearly 40% year-on-year.
In October last year, the price of ternary live pigs outside the country fell to 10.63 yuan/kg, the lowest point so far in this cycle. Since then, the price of pigs has rebounded, and the range has rebounded by nearly 80%. Since the beginning of this year, the price of pigs has fluctuated and fell again, from 16.43 yuan/kg in early January to about 12.57 yuan/kg.
“After a large stocking of pork before the Spring Festival, the overall demand after the festival is at a low level, and the supply and demand pattern is still strong in supply and weak in demand, resulting in a rapid decline in national pig prices. Since July last year, the country’s reproductive sows have experienced the first month-on-month decline in this cycle, and continued It has been several months, but the number of fertile sows still needs to be closely monitored, and it is not the only criterion for judging the trend of the cycle. Obviously, the last round of pig price rebound hindered the process of production capacity reduction, and the downward pressure on pig prices in the off-season consumption is great. ” an agricultural industryanalysttold reporters.
The above-mentioned analysts told reporters that it is expected that pig prices will still face downward pressure at least until the end of the second quarter. “The process of the second wave of capacity reduction is an important factor in determining the downside of pig prices. In the medium and long term, the process of cyclical grinding will slow down capacity reduction, and it will be difficult to completely reverse the situation of relative excess supply. Pig prices may increase in 2022. Periodic and seasonal rebounds are expected, and the annual average price is expected to remain relatively sluggish,” he said.
Pig companies continue to spend the winter in the first half of the year
In 2021, with the sharp and rapid decline in pig prices, the performance of listed pig companies will be at the bottom of the industry.Zhengbang TechnologyandWen’s sharesIt is estimated that the highest loss for the whole year is 19.7 billion yuan and 13.8 billion yuan, respectively, and the scale of the loss is the third and fifth lowest in the whole market.
Among them, the huge loss of Zhengbang Technology led to a negative net asset. From February 7th to 8th, the share price of Zhengbang Technology continued to drop by the limit. On February 9th, the company’s share price fell to 6.6 yuan, a new low since February 2019. As of the close on February 15, the share price of Zhengbang Technology was reported at 7.21 yuan, with a total market value of 22.7 billion yuan.
There is no doubt that the entire industry is losing money and the bottom of the cycle is confirmed, but the process of grinding down the price of pigs is long and painful.Reporter StatisticsannouncementLater, it was found that the planned slaughter volume of mainstream listed pig companies in 2022 is expected to increase by more than 30% compared with the slaughter volume in 2021.
Muyuan sharesThe recently launched equity incentive plan shows that the performance assessment targets set for this equity incentive are that the sales volume of live pigs in 2022 and 2023 will increase by no less than 25% and 40% from the base of 2021, and the corresponding values will be 50.33 million and 50.33 million, respectively. In 2021, the company will sell 40.263 million live pigs, including 36.887 million commercial pigs, 3.095 million piglets and 281,000 breeding pigs.
This means that the supply of only the top listed pig companies is still growing. The company must not only ensure that the slaughter volume increases as planned, lay the foundation for the “profit running” after the cycle reverses, but also face the operating costs brought about by the low pig price. , cash flow constraints and other challenges.
Taking Wen’s shares as an example, the company hasresearchIn the minutes, it was stated that the company will continue to make cost adjustments in the four major areas of expenses, scouring, feed, and seed this year, and make some structural adjustments appropriately in areas with higher costs and greater operating pressure. Excellent, cost reduction.
“From the perspective of the industry’s break-even line, if the price of pigs is higher than 13 yuan/kg, it will not be able to form an effective elimination, and the turning point of the cycle fundamentally depends on the process of production capacity reduction.” The above-mentioned analyst told reporters, “After the Spring Festival, The National Development and Reform Commission has stated that it will start the purchase and storage of frozen meat depending on the situation. In the short term, the purchase and storage of pig prices will have a limited boost, but the development of the purchase and storage work is expected to stabilize market sentiment and help stabilize the bottom of the pig price, reducing panic pressure or selling. risks of.”
In the secondary market, there are already market funds to deploy pork stocks in advance. Since the beginning of this year, the stock prices of 9 pork stocks have risen by more than 10%.Aonong Bio(603363.SH) recorded a cumulative increase of 57.17%,Leading sector；Superstar farming and animal husbandry(603477.SH) On February 11, the intraday record high was refreshed, with a cumulative increase of 48.39% since the beginning of the year, followed closely behind; Muyuan shares rose by 10.91%, Wen’s shares andnew HopeThey rose by 9.76% and 6.64% respectively, which greatly outperformed the major stock indexes.
Regarding the rebound of the pig sector, the aforementioned analysts said that although the process of periodic bottom grinding is painful, the worst period for the entire sector is likely to have passed. “Combining the cycle trend and the price-performance ratio of pig companies’ valuations, at present, the valuation of mainstream companies is at the bottom range. Funds to buy breeding stocks are Bo’s expectations, and it is the rising logic of emotional recovery. Performance recovery still needs to wait.” The analyst Said, “There are many factors that affect the cycle. During the bottom grinding period, listed pig companies should reduce investment, maintain effective production capacity, and smoothly pass the bottom of the cycle.”
(Article source: First Finance and Economics)