1、 Market Review
The agricultural index rose, and fishery and aquaculture took the lead. 1. Last week, Shenwan agricultural index rose 0.04%. Over the same period, the Shanghai Composite Index rose 0.6%, the Shenzhen Component Index rose 0.99%, and the performance of the agricultural sector basically kept pace with the market. 2. Four of the eight sub sectors rose, of which fishery and aquaculture rose by 6.67% and 1.12%, ranking the top two. 3. The top 10 gainers are concentrated in the fishery and Shenzhen Agricultural Products Group Co.Ltd(000061) processing sector, and the top 10 losers are concentrated in the seed industry sector. The top three stocks were Shandong Xiantan Co.Ltd(002746) , Oriental Ocean and Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) .
2、 Investment advice
According to official data, the speed of capacity removal in the industry has slowed down recently due to the rebound of pig prices, but the trend of capacity removal is still continuing. In 2022, with the deregulation of production capacity, the pig industry is expected to usher in a new round of cycle reversal. We are optimistic about the investment opportunities of breeding industry and seed industry in the medium and long term, and focus on recommending high-quality industry leaders with safe valuation.
1. Seed industry: Recently, favorable policies have been intensively released, focusing on the recommendation of high-quality seed industry leaders. Recently, the seed industry has ushered in the intensive release of a series of favorable policies. Following the implementation of the new seed law, the national standard for the approval of genetically modified soybean and corn varieties and other relevant industrial policies to promote the commercialization of genetically modified staple grains are also expected to be implemented soon. We believe that the mass production and listing of genetically modified corn and soybean seed products will be approaching. With the mass production and listing of genetically modified staple grain seed products, the seed industry will usher in a new period of rapid growth. Leading enterprises have first mover advantages in transgenic technology R & D and product layout, and are expected to gain more market share in the future. We maintain the positive rating of the seed industry, especially the investment opportunities of the high boom corn seed industry. In terms of individual stocks, focus on Shandong Denghai Seeds Co.Ltd(002041) with excellent variety combination and continuous growth, as well as Yuan Longping High-Tech Agriculture Co.Ltd(000998) , Beijing Dabeinong Technology Group Co.Ltd(002385) with leading advantages in transgenic R & D and variety layout, and pay attention to Winall Hi-Tech Seed Co.Ltd(300087) .
2. Breeding industry chain: 1) pig breeding: pay attention to the cost leading enterprises with reasonable valuation in the process of continuous capacity removal. Pig prices began to stabilize and rebound after the recent continuous correction. According to statistics, as of last weekend (December 31), the average price of pigs in 22 provinces and cities in China was 16.3 yuan / kg, up 1.9% on a weekly basis. On the supply side, from the situation of newborn piglets in the early stage, it is expected that the slaughter volume of newborn pigs before the festival will maintain growth month on month. On the demand side, the peak period of bacon production is basically over, but the peak season of family and catering consumption is approaching, and the power of consumption growth is not reduced. With both supply and demand rising, we expect that the pig price will fluctuate and operate stably before the festival or on the basis of the current price, and it is less likely to continue the in-depth adjustment. Official data show that at the end of November, the number of fertile sows in China was 42.96 million, down 1.2% month on month, 4.8% higher than the normal number. According to official data, the speed of capacity removal in the industry has slowed down recently due to the rebound of pig prices, but the trend of capacity removal is still continuing. It is expected that after the double festival, with the adjustment of pig price, the pace of capacity removal will be accelerated again. We believe that in 2022, with the deregulation of production capacity, the pig industry is expected to usher in a new round of cycle reversal. In terms of valuation, at present, the market value of most pig enterprises is below the historical average and has a certain margin of safety. Therefore, the sector is optimistic about the rating. Individual stocks mainly recommend Muyuan Foods Co.Ltd(002714) with leading cost and Wens Foodstuff Group Co.Ltd(300498) and Tecon Biology Co.Ltd(002100) with obvious improvement in production indicators. 2) Dynamic insurance: on the eve of the new cycle, the prosperity of pig vaccine was under short-term pressure, but the static PE was at the bottom of history, the safety margin of valuation was high, and the optimistic rating was maintained. Individual stocks mainly recommend Wuhan Keqian Biology Co.Ltd(688526) with reasonable valuation and significant growth.
3、 Industry data
Pigs: in the 52nd week, the average ex factory price of pigs in 22 provinces and cities was 16.3 yuan / kg, up 0.31 yuan / kg from last week; The average loss of self breeding heads in the main pig producing areas in China was 39.77 yuan. By the end of October 2021, the number of fertile sows in China was 43.48 million, a year-on-year increase of 6.6%;
Broilers: in the 52nd week, the average price of chicken seedlings in Yantai, Shandong Province was 1.4 yuan / feather, unchanged on a weekly basis; The average price of white feather meat and wool chicken in front of the shed was 3.97 yuan / kg, down 0.01 yuan / kg from last week; In the 52nd week, the single feather loss in broiler breeding was 0.39 yuan;
Feed: according to the statistics of Boya Hexun, in the 52nd week, the average price of broiler feed was 3.8 yuan / kg, unchanged on a weekly basis; The price of fattening pig feed was 3.61 yuan / kg, down 0.01 yuan / kg from last week; Aquatic products: in the 52nd week, the sea cucumber in Shandong Weihai bulk wholesale market was 200 yuan / kg, unchanged on a weekly basis; The price of scallops was 12 yuan / kg, unchanged on a week-on-week basis; Shrimp price was 360 yuan / kg, unchanged on a week-on-week basis; The price of abalone was 110 yuan / kg, unchanged from last week; Sugar, cotton, corn, soybean meal, wheat and rice: in the 52nd week, the spot price of Nanning white sugar was 5665 yuan / ton, up 8 yuan / ton from last week; In the 52nd week, the price of 328 grade cotton in China was 22023 yuan / ton, up 79 yuan / ton from last week; The average purchase price of corn in China was 2629 yuan / ton, down 13 yuan / ton from last week; The average spot price of soybean meal in China was 3588 yuan / ton, up 29 yuan / ton from last week; The average spot price of Chinese wheat was 2848 yuan / ton, unchanged on a week-on-week basis; The average price of Japonica Rice in China was 2720 yuan / ton, unchanged on a weekly basis;
4、 Risk tips
The price changes of raw materials such as sudden epidemic diseases, livestock and poultry, aquatic products and corn were less than expected
