On March 7, Muyuan Foods Co.Ltd(002714) ( Muyuan Foods Co.Ltd(002714) ), Wens Foodstuff Group Co.Ltd(300498) ( Wens Foodstuff Group Co.Ltd(300498) ) and other pig enterprises released sales briefings in February. It was found that the price of commercial pigs was still declining, showing a downward trend both month on month and year-on-year.
Industry insiders believe that the current downturn in pig prices is mainly due to oversupply. With the acceleration of capacity removal in the industry, it is optimistic that it will gradually improve during the year, but the specific market trend depends on the length and depth of capacity removal.
Pig prices continued to fall
Combing the sales data of various listed pig enterprises since this year, although the sales performance is uneven, the price decline is the common main line. Most of them fell by more than 10% month on month and 50% year-on-year.
According to the announcement, Muyuan Foods Co.Ltd(002714) 1-february, the company sold 7.831 million pigs, with a sales revenue of 10.162 billion yuan; The average selling price of commercial pigs is 12.38 yuan / kg, a decrease of 16.07% compared with December 2021. Compared with the average price of 26.95 yuan / kg in the same period last year, it has been halved, with a year-on-year decrease of 54%. Over the past year, Muyuan Foods Co.Ltd(002714) pig prices have experienced a slight shock after a rapid decline. They hit a stage low of 11.49 yuan / kg in September last year and showed a tail raising market at the end of the year, but they have begun to decline gradually since this year.
The pig price trend of Wens Foodstuff Group Co.Ltd(300498) is similar to that of Muyuan Foods Co.Ltd(002714) . In February, 1.069 million pigs were sold, realizing an income of 1.575 billion yuan. The average selling price of hairy pigs was 12.55 yuan / kg, down 10.93% month on month; The year-on-year decline was 55.87%.
Guangdong Guanghong Holdings Co.Ltd(000529) ( Guangdong Guanghong Holdings Co.Ltd(000529) ) in February, 7427 pigs were sold, with an income of 6.51 million yuan. The average selling price of pigs was 14.58 yuan / kg, a month on month decrease of 6.6% and a year-on-year decrease of 82.5%. From January to February, the company sold 1.55 pigs in total, with an income of 12.19 million yuan and an average sales price of 15.04 yuan / kg, a year-on-year decrease of 77%.
Hunan Zhenghong Science And Technology Develop Co.Ltd(000702) ( Hunan Zhenghong Science And Technology Develop Co.Ltd(000702) ) sales briefing shows that the company sold 7100 pigs in February, with a sales revenue of 9.3407 million yuan, a decrease of 53.08% and 63.16% month on month and a year-on-year decrease of 4.58% and 49.66% respectively. The decline in revenue is greater than the decline in sales volume. Therefore, it can be seen that the price of Hunan Zhenghong Science And Technology Develop Co.Ltd(000702) pigs is also continuing to decline, and the company also frankly said that the decline in sales revenue is mainly due to the decline in the sales price of pigs in the pig market
when will the inflection point come
Since the Spring Festival in 2022, the decline of pig prices has accelerated and touched the early warning, and the transaction price of pigs in many places has fallen below 6 yuan / kg. According to the monitoring of the national development and Reform Commission, in the week from February 21 to 25, the national average pig grain price ratio was 4.98:1, falling below 5:1, entering the level-1 early warning range of excessive decline determined in the “plan for improving the regulation mechanism of government pork reserves and ensuring supply and price stability in the pork market”. At the same time, the prices of feed raw materials such as soybean meal, corn and wheat rose sharply, pushing up the cost of pig breeding. At present, the cost per ton of feed has increased by about 400 yuan / ton compared with the fourth quarter of last year, and the cost of pig breeding has increased by about 1-1.2 yuan / kg. According to the statistics of relevant institutions, a pig bred and raised by itself in the Chinese market has a loss of more than 400 yuan / head.
Recently, the national development and Reform Commission, together with relevant departments, started the collection and storage of the central frozen pork reserve to stabilize the pig price. At present, the collection and storage has been started in Beijing, Jiangxi, Hubei, Chongqing, Yunnan, Shaanxi, Ningxia and other places, and will be started in other places. In March, the pig price entered the horizontal adjustment period. According to the data monitoring of the pig price system of China pig breeding network, from February 28 to March 6, the price range of three yuan live pigs at home and abroad was 12.64-12.76 yuan / kg.
pig price follow-up trend combing the views of head pig enterprises, most of them believe that the current low price is mainly due to excess supply. With the acceleration of capacity removal, they are optimistic that it will gradually improve during the year.
Muyuan Foods Co.Ltd(002714) recently, when accepting institutional research, he said that the current pig price is low, which is due to both the relative surplus of supply and the demand side. However, at this stage, the marginal change of supply has a greater impact than the marginal change of consumption, and the main contradiction is the relative surplus of supply. In addition, the multi-point outbreak of covid-19 affected the demand of consumers and restaurants, and also had a certain impact on the price of pigs. In terms of the trend of pig price, Muyuan Foods Co.Ltd(002714) it is expected that the pig price will improve in the second half of the year.
Wens Foodstuff Group Co.Ltd(300498) said that at present, the industry’s production capacity has not been fully cleared, and the future market trend mainly depends on the length and depth of capacity removal. It is preliminarily estimated that the pig price will remain at a low position in the first half of 2022, and the de industrialization of industrial capacity will accelerate. It is optimistically estimated that after the third quarter of 2022, pig prices may enter the upward channel of the next cycle; It is pessimistic to estimate that 2022 is still at the social average breakeven line, and it may take 2023 to enter the upward channel of the next cycle
Pig enterprises have their own tricks in capital operation. Pig prices are expected to enter the recovery channel in the third quarter
