I. core view
Rating and Strategy: the bottom of pig price rises sharply, and the upward trend in the future cycle is expected. The average market value of breeding stocks and other indicators are at the bottom, and the safety margin of investment is high. We continue to be “optimistic” about pig breeding, and recommend four golden pigs. The capacity removal effect of the broiler industry has gradually appeared for two consecutive years, and the product price is expected to fluctuate upward above the cost line. At present, the profitability of all links of the industrial chain is good. It is suggested to pay attention to the bottom allocation opportunities of the broiler sector. Grain prices may continue to operate at a high level in the medium and long term, driving the rise of the profit center of the planting industry and maintaining the “optimistic” rating of the industry.
1. Aquaculture industry chain
1) pig industry: maintain the “optimistic” rating and continue to recommend four golden pigs. Last week, the appearance price of pigs in Jiangxi Province was 15.94 yuan / kg, up 0.44 yuan per week; Piglets were 34.33 yuan / kg, up 1.24 yuan per week; Binary sows were 33.68 yuan / kg, up 0.04 yuan per week. The average head loss of the self breeding and autotrophic model is estimated to be 175 yuan, 61 yuan less than that of last week. Referring to the past several cycles, we believe that the upward trend of pig price cycle in the future has been formed on the basis of the deregulation of breeding capacity, which deserves the attention of the market. Judging from the average market value and other indicators, the valuation of individual breeding stocks is at the bottom and the safety margin of investment is high. Therefore, maintain the “optimistic” rating of breeding and continue to recommend four golden pigs, Muyuan Foods Co.Ltd(002714) , Tecon Biology Co.Ltd(002100) , Shenzhen Kingsino Technology Co.Ltd(002548) and Tangrenshen Group Co.Ltd(002567) , pay attention to Wen’s, Fujian Aonong Biological Technology Group Incorporation Limited(603363) , Leshan Giantstar Farming&Husbandry Corporation Limited(603477) , Hunan New Wellful Co.Ltd(600975) , tianbang.
2) white chicken industry: maintain optimistic rating and focus on prebiotics and Minhe. Last week, the average price of chicken seedlings in the main production area was 2.58 yuan / feather, down 0.1 yuan per week; The average price of wool chicken was 4.46 yuan / kg, down 0.03 yuan a week. In terms of production capacity, at the end of April, the inventory of parents’ generation in production increased by 5.99% and decreased by 12.33%, about 6% lower than the annual average. From the perspective of production capacity, the supply of broilers is expected to be tight from May to June, so there is less pressure for further price correction, and the probability will be stronger and upward above the cost line. In addition, the recent outbreak of highly pathogenic avian influenza in European and American countries may affect China’s introduction, and the industry supply contraction and medium-term price rise are expected to increase. The valuation index of poultry companies fell back to the historical bottom, and it is strongly recommended to pay attention to the bottom allocation opportunity of broiler sector. Individual stocks focus on Shandong Minhe Animal Husbandry Co.Ltd(002234) , Shandong Yisheng Livestock & Poultry Breeding Co.Ltd(002458) and Fujian Sunner Development Co.Ltd(002299) .
2) yellow chicken industry: maintain the “optimistic” rating and recommend Jiangsu Lihua Animal Husbandry Co.Ltd(300761) . In April, the price of Lihua yellow chicken was 12.32 yuan / kg, down 0.49 yuan / kg per month; Wen’s yellow chicken sold for 13.31 yuan / kg, down 0.13 yuan / kg per month. At the end of April, the production and stock of parent breeders in China decreased by 4.45% and 10.01% respectively, 5% lower than the annual average level. From the perspective of production capacity, the supply of yellow chicken is tight from May to June, and the chicken price may rise in shock. In the medium and long term, environmental protection constraints and the transformation of live birds to fresh ice will raise the industry threshold, promote the withdrawal of small and medium-sized production capacity and optimize the competition pattern. Maintain the “optimistic” rating of the industry, mainly recommend Jiangsu Lihua Animal Husbandry Co.Ltd(300761) , and pay attention to Wens Foodstuff Group Co.Ltd(300498) and Hunan Xiangjia Animal Husbandry Company Limited(002982) .
3) dynamic insurance: give a good rating, with emphasis on Wuhan Keqian Biology Co.Ltd(688526) . The pig cycle is reversed and the vaccine boom will definitely pick up. In the medium and long term, the improvement of large-scale breeding level, the upgrading of vaccine technology and the listing of new products will drive the expansion of the animal protection market. At the same time, the new GMP certificate certification, feed prohibition and breeding restriction, as well as the improvement of the biological security level of the breeding industry will promote the reform of the animal protection industry and optimize the competition pattern. The valuation of the animal insurance company is at the bottom of history, and the investment safety margin is high, so it is given a good rating. Stocks with reasonable valuation and R & D advantages are recommended Wuhan Keqian Biology Co.Ltd(688526) .
2. Planting industry chain
1) planting: maintain the “optimistic” rating, and highlight Jiangsu Provincial Agricultural Reclamation And Development Co.Ltd(601952) . India’s announcement of a ban on wheat exports will affect the international trade pattern of wheat and be conducive to the high rise of grain prices. The importance of China’s planting industry is highlighted, the rating of “optimistic” is maintained, and individual stocks are mainly recommended Jiangsu Provincial Agricultural Reclamation And Development Co.Ltd(601952) .
2) seed industry: maintain a long-term “optimistic” rating, focusing on Shandong Denghai Seeds Co.Ltd(002041) and Yuan Longping High-Tech Agriculture Co.Ltd(000998) . It is a general trend for corn and soybean transgenic seeds to go on the market. With the landing of GM, the market space of seed industry will be expanded and the competition pattern is expected to be reshaped. The head enterprises with early layout R & D are expected to seize more market share by virtue of the first mover advantage. Maintain the “optimistic” rating and focus on the investment opportunities of corn seed industry. In terms of individual stocks, focus on Shandong Denghai Seeds Co.Ltd(002041) , Yuan Longping High-Tech Agriculture Co.Ltd(000998) , Beijing Dabeinong Technology Group Co.Ltd(002385) .
II. Market Review
The overall performance of the agricultural sector kept pace with the market, and the planting sub sector rose strongly. 1. Last week, the Shenwan agricultural index rose 1.64%. The agricultural composite index rose 64.01% and the performance of the Shenzhen composite index basically rose by 2.2% over the same period. 2. As for the fine molecule industry, except for the decline of feed, others rose, with planting, fishery and animal protection leading the increase; 3. The top 10 gainers are mainly concentrated in the planting sector, and the top 10 losers are concentrated in the breeding sector. The top three stocks in terms of gains were Oriental Ocean, Zhongnongfa Seed Industry Group Co.Ltd(600313) and Yantai Shuangta Food Co.Ltd(002481)
III. industry data
Pigs: in the 20th week, the ex factory price of pigs in Jiangxi Province was 15.94 yuan / kg, with a weekly increase of 0.44 yuan / kg; In the 20th week, the self breeding heads in the main pig producing areas in China lost 175 yuan, 61 yuan less than last week. By the end of March 2022, the number of fertile sows in China was 41.85 million, with a monthly decrease of 0.98%;
Broiler: in the 20th week, the average price of chicken seedlings in Yantai, Shandong Province was 2.58 yuan / feather, down 0.1 yuan per week; The average price of white feather chicken in front of the shed was 4.46 yuan / kg, down 0.03 yuan per week; In the 20th week, the single feather profit of broiler breeding was 1.37 yuan, 0.36 yuan less than that of the previous week;
Feed: in the 20th week, the average price of broiler feed was 3.93 yuan / kg, unchanged on a weekly basis; The price of fattening pig feed was 3.80 yuan / kg, unchanged on a weekly basis;
Aquatic products: in the 20th week, the price of sea cucumber / scallop / prawn / Abalone in Shandong Weihai wholesale market was 180 / 10 / 310 / 100 yuan / kg, unchanged on a weekly basis;
Grain and others: in the 20th week, Nanning white sugar spot was 5896 yuan / ton, with a weekly increase of 80 yuan; China’s 328 grade cotton was 22200 yuan / ton, down 115 yuan per week; China’s corn purchase was 2808 yuan / ton, unchanged on a weekly basis; Chinese soybean meal spot 4339 yuan / ton, up 147 yuan a week; In the 20th week, China’s wheat spot was 3246 yuan / ton, up 15 yuan per week; The average price of Japonica Rice in China was 2776 yuan / week;
IV. risk warning
The price changes of raw materials such as sudden epidemic diseases, livestock and poultry, aquatic products and corn are less than expected
