Industry dynamic information
Core view:
Thinking this week: Recently, the prices of feed raw materials such as corn, wheat and soybean meal have continued to rise, and feed enterprises have continuously raised feed prices, exacerbating the cost pressure on the breeding end. Although under the guidance of consistent expectations, the breeding end is generally optimistic about the pig price market in the second half of the year, resulting in a slight lack of willingness to actively eliminate after the Spring Festival, the cost pressure may lead to changes in the breeding end mentality, which does not rule out the acceleration of the elimination of production capacity at the breeding end in the second and third quarters.
Live pigs: the rise in grain prices intensifies the pressure on breeding costs. Pay attention to the pace of capacity removal in March and April. The selling price of commercial pigs this week was 12.02 yuan / kg, with a month on month ratio of -0.37 yuan; The price of 15kg piglets is 400 yuan / head, with a month on month ratio of 0 yuan. This week, the price of pigs was stable and fell, the supply of pigs was sufficient, and the terminal delivery was difficult to see a strong boost. The outbreak of covid-19 epidemic in many places in China accelerated the shipment speed of some markets. At present, the capital reserve and cash flow have become the core of the competition at the breeding end. At the same time, it is necessary to observe the real willingness and behavior of farmers to fill the fence (or eliminate) under the guidance of consistent expectations. Focus on Wens Foodstuff Group Co.Ltd(300498) , Muyuan Foods Co.Ltd(002714) , and pay attention to Fujian Aonong Biological Technology Group Incorporation Limited(603363) , New Hope Liuhe Co.Ltd(000876) , Tecon Biology Co.Ltd(002100) , etc.
Seed industry: corn and wheat prices are strong in the short term
The optimistic assumption is that some genetically modified varieties may be approved at the beginning of this year, some genetically modified seeds can be listed and sold at the end of this year, and some enterprises can cash in their performance. In the medium and long term, the commercial application of genetically modified varieties is expected to promote the change of industry pattern and benefit high-quality industry leaders, such as Yuan Longping High-Tech Agriculture Co.Ltd(000998) , Beijing Dabeinong Technology Group Co.Ltd(002385) , Shandong Denghai Seeds Co.Ltd(002041) , Winall Hi-Tech Seed Co.Ltd(300087) , etc.
Dynamic insurance: pay attention to the sector valuation and repair market
The marginal improvement of breeding market in the future is expected to provide market increment for the development of growth tracks such as alternative antibodies and pets and new products such as non plague vaccines, and the performance of leading enterprises is expected to continue to grow. The current valuation of the sector is low, or usher in the valuation repair market. Focus on Tianjin Ringpu Bio-Technology Co.Ltd(300119) , recommend Jinyu Bio-Technology Co.Ltd(600201) , Pulike Biological Engineering Inc(603566) , Wuhan Keqian Biology Co.Ltd(688526) , Qingdao Vland Biotech Inc(603739) , pay attention to Hvsen Biotechnology Co.Ltd(300871) , etc.
Pets: the performance and valuation are expected to improve. The rise of domestic products is still the main investment line. In 2021, the scale of China’s urban pet (dog and cat) consumer market reached 249 billion yuan, a year-on-year increase of 20.6%, and the growth rate returned to the pre epidemic level. China’s pet industry is developing rapidly and its fundamentals remain unchanged. Pet food and medical care have natural advantages over other market segments. Continue to recommend favorite food targets Yantai China Pet Foods Co.Ltd(002891) and Petpal Pet Nutrition Technology Co.Ltd(300673) etc.
High quality industry leaders: recommended leaders in feed sector Guangdong Haid Group Co.Limited(002311) and poultry industry chain Fujian Sunner Development Co.Ltd(002299) , yellow feather broiler targets Jiangsu Lihua Animal Husbandry Co.Ltd(300761) and Hunan Xiangjia Animal Husbandry Company Limited(002982) etc.
Risk tips: the risk of sharp fluctuations in market prices caused by emergencies, the risk of epidemic diseases in the breeding industry, the risk of uncertain policies, the risk of Shenzhen Agricultural Products Group Co.Ltd(000061) price fluctuations, etc.
