This week’s view:
Planting industry chain: on February 16, 2022, the relevant person in charge of the animal husbandry and Veterinary Bureau of the Ministry of agriculture and rural areas talked about the reduction and substitution of feed soybean meal, saying that if the relevant policies are effective and measures are in place, the reduction of soybean meal in breeding industry can be more than 23 million tons, equivalent to about 30 million tons of soybeans, through the promotion of low protein diet technology, the excavation and utilization of existing resources and the increase of high-quality forage supply, It is equivalent to the soybean output of 230 million mu of cultivated land. However, according to the latest casde report of the Ministry of agriculture and rural areas, it is expected that China’s total soybean consumption in 2021 / 22 will further increase by 4.82 million tons and the output will decrease by 3.2 million tons compared with 2020 / 2021. It is expected that the reduction and substitution of soybean meal in the future will partially alleviate the gap between soybean supply and demand, but the overall huge gap remains unchanged. In terms of the revitalization of the seed industry, in recent years, the policies focusing on seeds have been issued continuously, and the policy direction of fully developing the seed industry is obvious, such as the acceleration of the issuance of crop transgenic safety certificate, the proposal of the action plan for the revitalization of the seed industry, the completion of the revision of the new seed law, and the coming into force The contents of the four regulations of the administrative measures for the safety evaluation of agricultural genetically modified organisms, the examination and Approval Measures for major crop varieties, the administrative measures for the production and operation license of crop seeds, and the provisions on the naming of agricultural plant varieties are expanded to the scope of genetically modified organisms, superimposing the tight supply and demand situation of corn and soybeans, which is expected to significantly boost the market demand for seeds and optimize the business environment of the seed industry, Favorable to the continuous expansion of market share of high-quality seed enterprises with strong R & D strength. In addition, the No. 1 central document will be released soon, or the seed industry will continue to emphasize that under the policy warm wind, the improvement of seed industry is expected to be relatively perfect. In terms of target selection, we mainly recommend Beijing Dabeinong Technology Group Co.Ltd(002385) , Yuan Longping High-Tech Agriculture Co.Ltd(000998) with obvious first mover advantage and Shandong Denghai Seeds Co.Ltd(002041) with excellent performance of hybrid maize varieties.
The perennial root of sugarcane is three years in China, but five to seven years in Brazil and Australia. This is the reason why the overall supply of sugar was relatively sufficient in the past and the price of sugar did not rise for many years, but the cycle will only be late and will not be absent. 2022 has been six years away from the high point of the previous cycle. Superimposed on the higher than expected rise of oil prices and the large release of global currencies, as well as the frequent occurrence of global extreme climate caused by sunspot movement in recent years, a new upward cycle of sugar has begun. In terms of target selection, the steady target focuses on recommending China’s sugar industry leader Cofco Sugar Holding Co.Ltd(600737) , and the elastic target Nanning Sugar Industry Co.Ltd(000911) is expected to benefit fully.
In addition, we continue to recommend chemical stocks Meihua Holdings Group Co.Ltd(600873) with a valuation of only 10 times. We expect that the performance elasticity in 2022 will come from the production of new lysine capacity by the end of 2021. In the long run, the monosodium glutamate and amino acid industries are limited by the new capacity under the background of carbon neutralization, and the valuation center is expected to rise.
Pig breeding: according to the latest data of the Ministry of agriculture and rural areas on February 17, by the end of January 2022, the number of fertile sows in China had been 42.9 million, a month on month decrease of 0.9% and a year-on-year decrease of 3.7%, equivalent to 104.6% of the normal population. A total of 2.74 million sows had been reduced for seven consecutive months. The month on month decrease rate in January was significantly slower than that at the end of December, but there was still some room for the stable number of fertile sows indicated by the Ministry of agriculture and rural areas at 41 million. Moreover, the price of pig feed continued to rise after the year, and the profit decreased accordingly, or it may continue to guide fertile sows to produce and increase efficiency. The current pig market corresponds to the high point of breeding sows in mid-2021. In terms of superimposed demand, pork will enter the off-season after the year, the phased supply of pigs will remain sufficient, and the pig price is under pressure. According to the data of zhuyitong, the average price of pigs nationwide this week was 12.30 yuan / kg, down 4.41% on a weekly basis. The overall downward trend of pig prices after the year was obvious. From the current time node, the average market value of some high-quality pig breeding stocks has fallen to a historically low level, and the configuration window has been gradually opened. For the selection of specific targets, it is recommended in turn: Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) , Wens Foodstuff Group Co.Ltd(300498) . In addition, Jiangxi Zhengbang Technology Co.Ltd(002157) , Tech-Bank Food Co.Ltd(002124) , New Hope Liuhe Co.Ltd(000876) , Tecon Biology Co.Ltd(002100) , Jiangsu Lihua Animal Husbandry Co.Ltd(300761) , Tangrenshen Group Co.Ltd(002567) , Hunan New Wellful Co.Ltd(600975) , Fujian Aonong Biological Technology Group Incorporation Limited(603363) , Shenzhen Kingsino Technology Co.Ltd(002548) are expected to benefit fully.
Risk tips
The recovery process of pig production capacity is less than expected, the product sales is less than expected, and the commercialization process of GM is less than expected.
