Since 2022, the pig market has remained depressed. Zhuo Chuang information data show that as of January 17, the average selling price of Sanyuan pigs across the country has fallen to 13.94 yuan / kg, down nearly 13% since the beginning of the year. At the same time, pig concept stocks have performed strongly recently, and the wind pig industry index has risen by 5.92% since the beginning of the year.
Historically, the profitability of pig breeding enterprises was highly consistent with the pork price, and the pork price guild led to a significant rise in relevant stocks. Analysts said that from the perspective of buying expectations, the far month futures contract is more in line with the trend of pork stocks, but it should be vigilant that the trend of pig price is not a reliable standard to judge corporate profits.
concept stocks bucked the market and strengthened
Data show that as of the close on January 17, the pig industry index rose 0.53% throughout the day. Among individual stocks, Shandong Delisi Food Co.Ltd(002330) rose by the limit, Leshan Giantstar Farming&Husbandry Corporation Limited(603477) rose by more than 7%, and Shenzhen Kingsino Technology Co.Ltd(002548) , Fujian Aonong Biological Technology Group Incorporation Limited(603363) rose by more than 2%.
In the spot market, the latest monitoring data from the Ministry of agriculture and rural areas showed that as of 14:00 on January 17, the average price of pork in the national Shenzhen Agricultural Products Group Co.Ltd(000061) wholesale market was 21.82 yuan / kg, down 2.0% from last Friday and 54.14% year-on-year.
It is understood that in the spot, futures and stock markets, the trend of the same kind of assets often varies or even deviates. The reason is that the spot price follows the current industrial fundamentals, futures pay more attention to the medium-term market, and stocks reflect the changes in the profitability of enterprises. Analysts believe that the recent strength of pig concept stocks against the market is mainly due to the market's optimistic expectation of future profits.
Zhang Ruihao, a pig researcher at Hubei Mailyard Share Co.Ltd(600107) futures, told the China Securities Journal that the animal husbandry industry has a relatively certain production cycle. The current downward trend of pig prices mainly stems from the abundant supply brought by the early recovery of production capacity, and the continuous reduction of production capacity since the second half of 2021 will naturally raise expectations for future prices and profitability, This is also the basic logic of the rise of pig concept stocks after new year's day.
"The weak short-term price of pigs is in line with expectations, and the long-term investment mainly observes the profit space of enterprises after the pig cycle has completed the downward range." China Securities Co.Ltd(601066) Wei Xin, senior analyst of pig futures, explained to the reporter of China Securities Journal that the current low pig price makes investors think that the pig production capacity is expected to be cleared in depth, which leads to a stronger expectation of pig price and benefits large listed companies.
Judging from the price trend of pig futures, its contracts in recent months also showed a continuous downward trend. "However, the 2209 contract price of Yuanyue still fluctuates in the range of 17000-18000 yuan / ton, which is higher than the average fattening cost of the current pig market. Therefore, the stock price trend of pig concept stocks is relatively strong." Everbright futures pig analyst LV pin said.
"The share price of pig concept stocks reflects the profitability of enterprises over a period of time, and the profitability of pig breeding enterprises is closely related to pig prices. Therefore, the trend of share price is more consistent with the trend of pig futures forward contracts." Lu Pin said.
the inflection point of pig cycle will be
Historically, the three rounds of pork price hikes in 2010, 2014 and 2018 have driven the stock prices of relevant stocks to rise significantly. Is the law of history still valid this time? Can investors who ambush pork stocks in advance achieve good results?
The number of fertile sows is an important index to judge the inflection point of the future pig cycle. From this index, according to the data of the Ministry of agriculture and rural areas, the number of fertile sows has continued to decrease since reaching the high point in June 2021. At present, it is generally maintained near 104% of the normal population, within the normal fluctuation range.
"According to this trend, the expected inflection point may appear from May to June 2022, but the elimination of fertile sows in 2021 is mainly aimed at the elimination and replacement of inefficient sows and high parity sows. Therefore, it is difficult to evaluate the actual capacity removal simply from the increase or decrease of quantity." Zhang Ruihao said.
From the perspective of supply and demand, according to Wei Xin's analysis, the slaughter volume of pigs reached a peak from the fourth quarter of 2021 to January 2022, but this mainly considers the slaughtering level and seasonal factors. The price inflection point may appear in the middle of the second quarter, due to weak consumption and high supply.
"From the perspective of futures, the market is relatively optimistic about the pig price in the third quarter. Without external force, it is expected that the next round of pig cycle will come step by step, and the approximate rate of pig price will fluctuate around the breeding cost line." Said LV pin.
On the whole, the market is optimistic about the consistency of judgment on the trend of pig price in 2022. Most people in the industry believe that pig price will go out of the falling section of this round of pig cycle in the second half of the year. However, LV pin reminded that in 2021, the market came out of a relatively unexpected market under highly consistent expectations.
enhanced impact resistance of the industry
Looking forward to the future, Zhang Ruihao reminded investors that the trend of pig price is not a reliable standard to judge the profitability of enterprises. If the increase of pig price mainly comes from demand, the profitability of pig enterprises is likely to improve; If the increase of pig price is caused by capacity loss, the capacity loss and recovery should be comprehensively considered.
"The current sow status and piglet care and feeding status in April and may will determine the pig production capacity in the second half of 2022. If you are interested in investing in relevant stocks, you can pay attention to relevant indicators." Zhang Ruihao said.
Wei Xin believes that the spot price of pigs in the future is expected to be dominated by weak shocks, and pork concept stocks are still in the expected stage of buying. In the long run, there may be obvious differentiation in the breeding sector.
From the perspective of industry, LV pin believes that the impact resistance of the whole pig industry is increasing. First, after the swine plague, the production capacity of pigs has recovered rapidly. In this process, great progress has been made in disease prevention and control, large-scale process and population optimization. Second, with the listing of pig futures, the market's ability to avoid operational risks through financial instruments is also increasing. The industry has gradually transitioned to cost reduction and efficiency increase. Chinese listed companies have made corresponding plans in feed raw material procurement, pig sales, by-product processing and so on.
