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Introduction: The live pig spot that has been consolidated for more than half a month has finally ushered in the purchase and storage of the market’s crazy speculation. Today, the performance of live pig spot, futures and pig stocks is different. What is the original intention of the country’s purchase and storage? Can the purchase and storage work have a strong drive for spot pig prices? Is the pig price trend backfired? Today, I would like to talk to you briefly.
The pig-grain ratio has fallen to the first-level warning, whether the purchase and storage can blow the horn of pig price rise
After the Spring Festival holiday, in terms of feed materials, due tocornTraders have a strong willingness to build warehouses, and deep processing companies are more motivated to purchase. In addition to the fast-changing international situation, corn prices have risen significantly. In contrast, the demand in the live pig market has dropped inertialy after the holiday. Although slaughter companies have started construction after the holiday, they have been dragged down by demand and have maintained a low level of operation. , The support for pig prices is limited, and it is mainly to maintain weak stability. Mysteel data monitoring shows that as of February 28, the price ratio of pig grains fell to 4.68:1, entering the first-level warning range for transitional decline. At the same time, according to the monitoring of the National Development and Reform Commission In the week from February 21st to 25th, the national average pig-grain price ratio was 4.98:1, entering the first-level early warning range for excessive decline determined by the “Improving the Government’s Pork Reserve Adjustment Mechanism and Doing a Good Job in the Work Plan to Ensure Supplies and Stable Prices in the Pork Market”. The official department issued the “Notice on Organizing the Purchase and Storage of the First Batch of Central Reserve Frozen Pork in 2022”. This week, the collection and storage of 40,000 tons of central reserve frozen pork will be organized on March 3 and March 4, 2022 respectively. carried out, 19,600 tons and 20,400 tons respectively.
After this wave of excessive fall-level warning, how big is the impact of the state’s purchase and storage on each link, let’s first understand what is the original intention of the state’s purchase and storage? The author thinks that the state’s announcement of the purchase and storage is to stabilize the price of pigs and boost market confidence. It is not to raise the price of pigs and make the price rise and fall sharply, which is not what the market wants. At the same time, the opening of the purchase and storage is also an affirmation of the overcapacity statement. Some people say that today’s stock market counterattack is driven by purchase and storage. I don’t think so. The sentiment of futures market driven by storage energy has been reflected in recent days. However, the rise of pig stocks is not the pot of purchase and storage, but the operation of capital customers. That’s it.
Secondly, the futures trend, which has been rising for several consecutive days, is stretched today, and the gains are completely buried. The near-month and far-month contracts are no longer strong, and 03 enters the delivery month, and the return is accelerated. The delivery logic reflects the futures into reality. For short-term futures In terms of contracts, 05 returned to the spot, and 07 and 09 continued to fall after hitting highs.
Finally, let’s talk about the impact of purchasing and storage on the spot market. In February, the monthly operating rate of slaughter enterprises was 17.06%, down 10.71 percentage points from the previous month. Affected by this, the planned completion of breeding enterprises in February was less than expected, which shows the difference in demand. Some plans have been postponed to after March. There is no doubt about the pressure on the market. Therefore, the purchase and storage of 40,000 tons has little support for the spot, and the supply is strong. The situation of weak demand is difficult to change. There is no doubt about whether the purchase and storage can blow the horn of rising pig prices. It is simply more difficult. Therefore, the author thinks that the decline in pig prices in March is reasonable. The average price of live pigs in February was 12.58 It is conservatively estimated that the average price drop in March may be 0.60-0.80 yuan/kg. From April to May, the live pig market is still in the historical low season of demand, and live pigs continue to be slaughtered. Therefore, the price of live pigs continues to run at a low level, and the production capacity is at an accelerated rate of elimination. .
Comprehensive point of view: the decline of live pigs is irreversible, and it is imperative to eliminate production capacity. Spot prices continued to grind bottom in March, April and May. (my steel mesh)
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Responsible editor: Li Tiemin