Core view
During the Spring Festival, the performance of pig prices was stable and the losses of the industry continued. According to sozhu.com, the market price of lean meat pigs on February 5 (the fifth day of the Lunar New Year) was 13.82 yuan / kg, up 1.4% from January 31 (the 29th day of the twelfth lunar month). Historically, the price of pigs on the fifth day of the lunar new year from 2016 to 2020 was - 0.9% / + 0.3% / + 1.3% / + 7.6% / - 1.5% / + 1.4% respectively compared with the new year's Eve. The performance of pig prices during the Spring Festival in 2022 was relatively stable, flat with the same period in history. According to Boya Hexun, before the Spring Festival, the average loss of self breeding heads still reached 311.55 yuan / head. According to the current pig price, we believe that the loss of the industry continued during the Spring Festival, or exceeded 300 yuan / head.
The northwest increased the most, while the eastern region decreased slightly. In terms of regions, among the five regions, the northwest region has the largest increase of 3.4%, and the regional average price is 13.24 yuan / kg, of which Gansu Province has the highest increase of 7.7%, and the average price is 12.93 yuan / kg; The only decline occurred in the eastern region, with a decline of 0.6% and an average price of 14.70 yuan / kg. Among them, Anhui Province and Zhejiang Province were provinces and cities, with a higher decline of 6.3% and 5.9% respectively.
After the Spring Festival, pig prices usually show a downward trend, and the losses of the industry may further deepen. From the performance of pig prices in recent five years, except for 2019 and 2020, which were affected by African swine fever and showed an upward trend after the Spring Festival, pig prices in other years showed a downward trend. After the Spring Festival, it is usually the off-season of pork consumption. The decline of pig prices is in line with the seasonal law of the year. At present, the supply of pigs is relatively sufficient. We believe that without supply distortion, After the festival, the probability of pig price will gradually decline, and the industry loss may further deepen.
Investment proposal and investment object
Losses in pig breeding continued, and the logic of industrial reversal was strengthened. During the Spring Festival, the increase of pig price is small, the loss of the industry continues, the expected further fermentation of capacity deregulation, and the reversal of pig price is basically determined. It is suggested to pay attention to the allocation opportunities of pig breeding sector and the agricultural theme etf159825 of Wells Fargo China Securities.
Risk tips
Shenzhen Agricultural Products Group Co.Ltd(000061) price fluctuation risk, epidemic risk, policy risk, industry competition and product risk
