Core view
Pig breeding: bottom or secondary grinding, rebound layout at the right time. This round of pig cycle is relatively special. The outbreak of non plague at the beginning of the year made 2021h1 appear centralized fence pressing, resulting in large pigs and fat pigs being forced out of the market, pork supply exceeding demand, and then superimposed with the rise of corn price, resulting in the continuous rise of feed cost and loss of pig breeding. Although pig prices have rebounded since the fourth quarter due to the recovery of the demand side and the reluctance to sell at the breeding side, they are still in the downward channel due to the incomplete capacity removal due to the relatively rich profits in the early stage. We expect that 2021q4 column supplement + 2022q2 consumption off-season + continuous release of production capacity, and 2022q2-q3 pig price may meet the second bottom.
The seed industry revitalization policy is overweight, and the industry prosperity is expected to improve. To make a turnaround in the seed industry
Promote China's development into a powerful seed industry. Since the 14th five year plan, the central government has put forward higher requirements for food security and seed industry development. In July 2021, the central comprehensive Deepening Reform Commission adopted the action plan for seed industry revitalization, which has important and far-reaching significance for the development of China's seed industry. Starting from the current situation of China's seed industry, it is obvious that China's corn seed industry has gone through supply side reform to destock. On the demand side, the increase of feed demand drives the improvement of market demand for seeds and the recovery of prosperity of China's corn seed industry. In the medium and long term, the commercialization of genetically modified varieties will bring new profit growth points to the industry and benefit high-quality leading enterprises.
Risk tips:
The actual slaughter volume of listed pig breeding companies is lower than expected; Shenzhen Agricultural Products Group Co.Ltd(000061) the price fluctuates greatly; The outbreak of breeding epidemic exceeds expectations or the extreme weather fluctuates greatly; The outbreak of breeding epidemic exceeds expectations or the risk of extreme weather disasters; Risk of agricultural policy change
