Breeding sector: 1) live pigs: the pig grain ratio was stable and down in the week, the pig price fell slightly, and the deep loss of the industry continued. On February 20, 2022, the price of three yuan live pigs abroad fell to 12.3 yuan / kg, a year-on-year decrease of 58.86%; As of January 2022, the number of fertile sows in China has reached 42.9 million, with a month on month decrease of 0.9% and a year-on-year decrease of 3.7%. It has turned negative for the first time since June 2020. On February 25, 2022, the profit loss of outsourcing piglet breeding was 145.85 yuan / head, and the loss of self breeding and self breeding was 481.9 yuan / head. The loss of self breeding and self breeding continued to expand for ten consecutive weeks. The price of soybean meal and other main feed raw materials continued to rise, and the price ratio of pig grain continued to decline steadily in the week. Many provinces issued a level-1 warning of excessive decline of pig grain ratio and started the collection and storage of pork reserves as appropriate. In the short term, the feed cost and the expectation of collection and storage may support the pig price. However, due to the weak demand side as a whole, the upward fluctuation of pig price is limited, and the deep loss of breeding continues. At the same time, there is a trend of high-efficiency binary sows replacing low-efficiency ternary sows in the change of production capacity structure. Therefore, we believe that the de industrialization of production capacity will continue. The pig price will continue to grind to the bottom in 2022h1, and continue to focus on the layout on the left, In the future, considering multiple factors such as the scale and certainty of marketing and the elastic space for cost reduction, it is suggested to pay attention to: Wens Foodstuff Group Co.Ltd(300498) , Tecon Biology Co.Ltd(002100) , Fujian Aonong Biological Technology Group Incorporation Limited(603363) , Muyuan Foods Co.Ltd(002714) . 2) Poultry: in the off-season, the chicken price will continue to callback in the week, and it is expected to continue to fall sharply, with limited space. The consumption demand in the off-season was weak, and the price of yellow feather chicken continued to decline during the week. The average price of fast big chicken, medium speed chicken, native chicken and black bone chicken was 5.91 yuan / 7.02 yuan / 8.81 yuan / 7.68 yuan / 500g on February 25, 2022, with a change of – 10.99% / – 4.49% / + 0.69% / – 0.90% on a weekly basis and – 20.88% / – 11.92% / – 2.87% / – 8.9% on a year-on-year basis. According to the data of the poultry branch of China Animal Husbandry Association, the stock of yellow feather chicken parents has basically decreased to the normal level in 2018. The supply contraction trend is expected to support the chicken price in the first half of the year. There is limited room for the sharp decline of yellow chicken price. We are optimistic about the leader of yellow chicken breeding industry with good cost control ability and growth. Key recommendations: Jiangsu Lihua Animal Husbandry Co.Ltd(300761) , It is suggested to pay attention to: Wens Foodstuff Group Co.Ltd(300498) , Hunan Xiangjia Animal Husbandry Company Limited(002982) . 3) Beef cattle breeding: in September 2020, the general office of the State Council issued the opinions on promoting the high-quality development of animal husbandry, which put forward the goal of “maintaining the annual self-sufficiency rate of beef and mutton at about 85%. There is a large gap between supply and demand in the industry. Pay attention to the opportunities of large-scale beef cattle breeding. It is suggested to pay attention to: Pengdu Agriculture & Animal Husbandry Co.Ltd(002505) .
Dynamic insurance sector: the policy is clear to promote the market-oriented and standardized development of the industry, and the leader of R & D + production + market advantage will benefit. Under the background of the policy of “cultivating animal products first and gradually canceling the policy of” developing animal products first and then replenishing the market “in 2025; Since July 2020, there has been a comprehensive “ban on resistance” in feed, and “limit resistance” and “reduce resistance” in breeding. The demand for high-end therapeutic veterinary chemicals has ushered in rapid growth; The code for quality management of veterinary drug production (revised in 2020) was issued on April 21, 2020 and will be implemented from June 1, 2020. By May 31, 2022, the backward industry capacity that has not reached the new target has not been reached or has been eliminated, the industry access threshold has been raised, and the competition pattern is expected to be optimized rapidly. In the medium and long term, industry leaders with the advantages of joint research and development of front-end scientific research institutes + high-quality production capacity + market channels are expected to make full profits. Key recommendations: China Animal Husbandry Industry Co.Ltd(600195) – market seedlings and high-end chemical drugs support high performance growth. It is suggested to pay attention to: Jinyu Bio-Technology Co.Ltd(600201) , Hvsen Biotechnology Co.Ltd(300871) , Tianjin Ringpu Bio-Technology Co.Ltd(300119) .
Seed industry sector: the seed industry is in high prosperity, and the era of transgenic commercialization may accelerate, focusing on long-term layout opportunities. The issue of Document No. 1 in 2022 once again reflected the importance of food security, and the action plan for the revitalization of seed industry was adopted in July 2021; In November 2021, the Ministry of agriculture and rural areas issued the decision of the Ministry of agriculture and rural areas on amending some seed industry regulations (Draft for comments), adding relevant rules on the approval of genetically modified crop varieties; On December 26, China’s rural work conference once again proposed “vigorously promoting seed sources and other key agricultural core technologies”. As an important prerequisite for food security, seed industry security has clear policy direction, the expansion space of transgenic breeding can be expected, and the leader of breeding technology is expected to benefit. It is suggested to pay attention to: Shandong Denghai Seeds Co.Ltd(002041) , Yuan Longping High-Tech Agriculture Co.Ltd(000998) , Winall Hi-Tech Seed Co.Ltd(300087) .
Risk tips: sudden epidemics or natural disasters, repeated covid-19 epidemics, and the implementation progress of industrial policies is less than expected.
