On April 18, the aquaculture sector led the market, and the Hithink Royalflush Information Network Co.Ltd(300033) aquaculture sector rose by 5.15% throughout the day. In particular, leading chicken stocks set off a wave of trading. Among them, Ningxia Xiaoming Agriculture & Animal Husbandry Co.Ltd(300967) ( Ningxia Xiaoming Agriculture & Animal Husbandry Co.Ltd(300967) . SH) rose by 14.12%, and Shandong Minhe Animal Husbandry Co.Ltd(002234) ( Shandong Minhe Animal Husbandry Co.Ltd(002234) . SZ), Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) ( Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) . SZ) and Shandong Xiantan Co.Ltd(002746) ( Shandong Xiantan Co.Ltd(002746) . SZ) all rose by the limit successively.
Is the rise of chicken stocks a temporary change or is it supported by fundamentals? Are there any investment passwords hidden in these trading stocks?
price rise is the fuse
The most direct driver of this round of market launch is price rise.
Since March this year, the price of eggs in the main producing areas of the country has risen steadily. The daily average price in 50 cities has increased from 8.58 yuan / kg to 9.96 yuan / kg, with a maximum increase of 16.1%. Ningxia Xiaoming Agriculture & Animal Husbandry Co.Ltd(300967) is the leader in the field of laying hens, with its business covering egg breeding, egg hatching and chick sales of grandparents and parents.
In addition, the price of white feather chicken has experienced a trough for more than a year and has begun to rebound recently. The average price of white feather broiler in the main producing areas increased from 7.36 yuan / kg in March this year to 8.89 yuan / kg in mid April, an increase of 20.7%. Shandong Minhe Animal Husbandry Co.Ltd(002234) , Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) and Shandong Xiantan Co.Ltd(002746) are important participants in the field of white feather chicken breeding Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) is at the upstream, and its business includes the introduction of ancestral chickens and the breeding and sale of parental breeding chickens Shandong Minhe Animal Husbandry Co.Ltd(002234) and Shandong Xiantan Co.Ltd(002746) businesses include commercial chicken fry and chicken products.
Image source: wind
The price of another kind of yellow feather chicken in China began to fall. The downstream of white feather chicken is mainly chain fast food restaurants, while the downstream of yellow feather chicken is mainly live poultry market, which is used for families, restaurants and hotels. In February this year, the highest price of yellow feather chicken reached 18.37 yuan / kg, and now it has fallen to 16.62 yuan / kg, a decrease of about 10%. China’s yellow feather chicken market presents a situation of “two super and many strong” dominated by two head companies Wens Foodstuff Group Co.Ltd(300498) ( Wens Foodstuff Group Co.Ltd(300498) . SZ) and Jiangsu Lihua Animal Husbandry Co.Ltd(300761) ( Hynar Water Group Co.Ltd(300961) . SZ). On April 18, the shares of Wens Foodstuff Group Co.Ltd(300498) and Jiangsu Lihua Animal Husbandry Co.Ltd(300761) rose by 5.88% and 5.05% respectively.
Last year, the price of yellow feather chicken continued to rise, stimulating a significant increase in the supply side, which is also one of the reasons for the recent decline in the price of yellow feather chicken. At the beginning of this year, the introduction of yellow feather chicken’s ancestral chicken began to decline, and the de production capacity has just begun.
white feather chicken recovery is expected to continue
The temporary rise and fall of prices is not enough to promote the sustainable development of relevant stock prices. However, the white feather chicken has experienced two years of capacity clearing, and the supply side is expected to shrink in 2022. Therefore, the price rebound of white feather chicken is expected to continue.
First of all, from the perspective of the growth cycle of white feather broilers, it takes nearly 15 months from the introduction of grandparents to the marketing of commercial generation, which requires four stages: grandparents, parents, commercial generation and marketing. In other words, the current broiler production can be roughly inferred from the introduction of ancestral chickens 15 months ago.
In 2020, the price of white feather chicken dropped and the feed price increased, resulting in the continuous narrowing of the profit space of the white feather broiler industry chain, the loss of the leading Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) and the sharp decline of Shandong Minhe Animal Husbandry Co.Ltd(002234) net profit. Since the second half of 2020, the white feather broiler industry has carried out self-regulation, eliminated breeding chickens in advance, and removed some production capacity. In addition, since 2020, the introduction of ancestral chickens has decreased by 17.79% year-on-year to 1.003 million sets.
According to the data of the poultry branch of China Animal Husbandry Association, from early April 2020 to the end of 2021, the average stock of ancestral chickens in production was about 1.1 million sets. Based on this data, it is predicted that the slaughter volume of white feather broilers in 2022 will be 5.39 billion according to the 1:35 expansion coefficient from grandparents to parents and 1:140 expansion coefficient from parents to commercial white feather broilers.
From 2019 to 2021, the number of white feather chickens increased year by year, from 4.4 billion to 5.8 billion. According to the forecast data, the number of white feather chickens will decline in 2022.
In terms of demand, China is the second largest consumer of broilers in the world, and the proportion of broiler production in the world has increased for many consecutive years. From 2016 to 2020, the proportion of Chinese broiler production in the world increased from 13.91% to 14.74%. On the one hand, it is due to the increase of chicken consumption per capita; On the other hand, the trend of catering chain also increases the demand for white feather chicken. It is worth mentioning that although the long-term trend of catering chain is not affected, the expansion of catering chain and the demand for chicken may be less than expected in the short term due to the epidemic.
On April 19, Shandong Minhe Animal Husbandry Co.Ltd(002234) , Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) and other white feather chicken leaders continued to be strong. As of the close, Shandong Xiantan Co.Ltd(002746) limit, Shandong Minhe Animal Husbandry Co.Ltd(002234) and Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) rose by 2.47% and 5.49% respectively.
