I. pig sector: pig prices stopped falling and rebounded this week, but breeding losses further intensified. According to the data of zhuyitong, the average price of Sanyuan pigs across the country on Sunday was 12.30 yuan / kg, up 4.8% on a weekly basis and down 52.6% on a year-on-year basis; However, the breeding loss this week further expanded, including the profit of self breeding pig breeding -549.21 yuan / head, down 0.4% on a week-on-week basis and 176.8% on a year-on-year basis; The profit of outsourcing piglet breeding was -287.03 yuan / head, down 11.2% week on week and up 47.5% year-on-year. In the short term, due to the obstruction of pig marketing in some areas caused by covid-19 epidemic and the recovery of pork demand driven by terminal centralized stock preparation, pig prices have stopped falling and rebounded this week. However, the overall loose supply and demand fundamentals determine that pig prices are still difficult to be optimistic for some time in the future, and the rise of superimposed feed costs will further squeeze breeding profits. According to our calculation, since the beginning of the year, the use cost of both self ingredients and commercial materials has increased significantly. Considering the lag effect of fat pig marketing cost accounting, it is expected that the breeding end will still bear great pressure of loss in the future. Therefore, the logic of low pig price - breeding loss - capacity removal is expected to continue to be deduced. We believe that after nearly three quarters of capacity adjustment, the industry is gradually transitioning from the active elimination of backward and inefficient capacity to the passive de capacity stage. As the breeding side still holds relatively optimistic pig price expectations for the second half of the year and even next year, the overall game mood is still strong, and the process of capacity de capacity may be more tangled and tragic. However, from the perspective of recovery history, serious animal diseases or sustained deep losses will lead to the accelerated deregulation of production capacity. Combined with the latest tracking situation, we believe that the main driving force of subsequent deregulation of production capacity may come from the latter, while structurally, farmers with high cost and high debt ratio may become the main force of subsequent deregulation of production capacity. Since the peak of production capacity in June 21, the cumulative de conversion rate has exceeded 6%. Although the overall situation is still in surplus, the logic of cycle reversal will be gradually strengthened with the passage of time. We still suggest to focus on the layout opportunities on the left. In terms of stock selection, it is suggested to comprehensively grasp the factors such as capital security, flexibility of listing volume and relative predictability of cost. It is suggested to focus on Wenshi, muyuan, superstar, Tiankang and other targets.
II. Animal protection sector: focus on Pulike Biological Engineering Inc(603566) , which is highly catalytic for the research and development of non plague vaccines, and Jinyu Bio-Technology Co.Ltd(600201) , which is undervalued. It is suggested to pay attention to the leading chemical drugs China Animal Husbandry Industry Co.Ltd(600195) and Hvsen Biotechnology Co.Ltd(300871) , which are expected to fully benefit from the improvement of both supply and demand.
Substantial progress has been made in the research and development of African classical swine fever vaccine. The Ministry of agriculture and rural areas plans to carry out emergency evaluation for the research and development of non classical swine fever subunit vaccine, and the relevant evaluation standards and principles have been determined and officially issued. At present, the relevant R & D units and enterprises are in the preparation stage of sorting out materials and submitting applications, and the pace of vaccine research and development and industrialized application may be accelerated in the future. We calculate that if all steps can be smoothly connected, the distribution of temporary production approval of subunit vaccine may be realized at the end of this year under optimistic circumstances, and it may enter the stage of formal commercial application next year.
If the plague vaccine is not successfully listed, it is expected to bring huge incremental space to the animal protection industry, and relevant participants are expected to benefit fully. Pulike Biological Engineering Inc(603566) , which has prominent advantages of subunit platform, is recommended. In addition, from the perspective of industry fundamentals, the animal protection industry is expected to see a double improvement in supply and demand in the second half of this year. The demand side may mainly benefit from the recovery of the consumption of vaccines and chemical products driven by the recovery of pig prices in the second half of this year, and the driving factors at the supply side may be more determined, mainly from the implementation of the new version of veterinary drug GMP, which will gradually eliminate the inefficient production capacity of the industry, which will benefit the leading enterprises to win a higher market share, The industry structure is expected to be significantly improved, and June will enter an excellent verification time point. In addition, the sharp drop in the price of chemical pharmaceutical raw materials this year is also expected to drive the significant restoration of the profitability of chemical pharmaceutical enterprises. It is suggested to focus on the leading targets of chemical medicine China Animal Husbandry Industry Co.Ltd(600195) and Hvsen Biotechnology Co.Ltd(300871) . In addition, it is recommended to pay attention to the leading animal protection Jinyu Bio-Technology Co.Ltd(600201) .
III. price tracking of poultry chain: ① for white chicken, according to Boya Hexun, the price of broiler seedlings in the main production area on Friday was 0.88 yuan / feather, with a rise of 15.8% on a weekly basis and a year-on-year decrease of 80.8%; The average price of chicken products in the main production areas was 9.62 yuan / kg, unchanged on a weekly basis, down 4.8% year-on-year; The average price of white feather broilers in the main production areas was 7.95 yuan / kg, with a weekly increase of 1.4% and a year-on-year decrease of 5.2%; Gross chicken breeding profit was -0.85 yuan / feather, down 51.8% on a weekly basis and up 56.9% on a year-on-year basis. ② In terms of yellow chicken, according to the data of xinmu.com, the price of fast big chicken on Friday was 5.92 yuan / kg, down 4.1% week on week and 14.6% year-on-year; The price of medium speed chicken was 6.81 yuan / kg, down 3.5% month on week and 4.9% year-on-year; The price of native chicken was 8.10 yuan / kg, down 4.6% on a week-on-week basis and 4.7% on a year-on-year basis; The price of black bone chicken was 8.51 yuan / kg, down 1.5% month on week and up 9.1% year-on-year.
Risk warning: spread of animal diseases; Intensified market competition; Product quality problems.
