Meat price "break ten"! Investors ask when to bottom, listed pig companies: only the gods know!

Mid-Autumn Festival consumption has not improved, meat prices "break ten", enema, roast sausage has become the "new favorite" of the festival ". When the pig cycle bottomed out is a mystery! Jin Xinnong said: Only the gods know.

Mid-Autumn Festival consumption season, pork prices continue to fall. On the 21st, in a farmer's market on Liaoning Road, North District, Qingdao, the retail price of the special price front elbow was changed from 9 yuan/jin to 8 yuan/jin. The boss said that it coincided with the Mid-Autumn Festival and National Day holidays, and specially reduced the price for promotion. The reporter visited and found that not only in the farmer's market, but also in sales channels such as chain supermarkets and meat brand counters, the retail price of pork "breaking ten" has also been seen everywhere.

According to the joint monitoring of the Information Center of the Ministry of Agriculture and Rural Affairs and Shandong Zhuochuang Information Co., Ltd., in the 36th week of 2021 (September 6-September 10), the total ex-factory price index of lean white pork in 16 provinces (municipalities directly under the Central Government) The weekly average was 18.12 yuan per kilogram, down 3.4 percent from the previous month and 60.8 percent year-on-year. In other words, to some extent, the price of meat has been "upside down".

Pork sales are mediocre, enema processing into holiday consumption "new favorite"

Although the price of meat is "friendly", the sales volume during the festival seems to be calm. In a farmer's market on Huantai Road, compared with the festive shopping atmosphere in front of the crab stall, the pork stall is obviously deserted. Ms. Yu, a retailer, told reporters that pork prices are now lower, coupled with the daily main consumer goods of many families, so there is no obvious difference in sales between weekdays and festivals. "You can sell more than 200 catties a day. In terms of price, better high-quality meat is about 13 to 15 yuan per catty, and you can buy lower-priced meat for less than 10 yuan." Many pork prices on the market have fallen to "single digits". However, the reporter found that with the fall in meat prices, all kinds of enemas and roast sausages processed on site have become the "new favorites" of hand-to-hand gifts during the festival ". The reporter saw in a farmer's market that there are a total of 7 meat stalls, all of which provide enema processing services. After consumers buy pork, they only need to pay about 5-6 yuan per catty for processing, and the meat stalls can be processed into ready-to-eat sausage, including spicy, spiced, cumin and other flavors to choose from. "The number of customers who come to process roasted sausage during the festival has increased significantly." Ms. song, the owner of the meat stall, said that at present, the daily processing capacity is more than 100kg, double that before the festival. "the main reason is that the demand for visiting relatives and friends during the festival is relatively large. for example, I have a total of 140kg of enema orders today, of which 60kg of guests require vacuum packaging, which is convenient to carry as a companion gift."

It is normal for a pig to lose 600 or 700 yuan.

As we all know, the price of pork on the demand side is closely related to the production capacity of pigs on the supply side. When pig production capacity decreases, meat prices are high; when pig production capacity recovers, meat prices fall. This is also a typical feature of the "pig cycle. Statistics from the Ministry of Agriculture and Rural Affairs show that pig production capacity has been fully restored. At the end of July, the national stock of breeding sows and pigs returned to 101.6 percent and 100.2 percent at the end of 2017, respectively, half a year ahead of schedule to achieve the recovery target. Not only the current pig production capacity is basically safe, "reserve army" is also very sufficient. Data show that in August, the number of live pigs increased by 1.1 month on month, increasing for six consecutive months, especially the number of new piglets born each month increased significantly. From February to August, the average monthly growth rate of new piglets in large-scale pig farms increased by 2.5, which means that the number of live pigs released from September this year to February next year will also continue to grow. "High prices hurt the people, low prices hurt farmers". If the price of meat is cheap, the price of pigs will naturally be low, so the life of farms and enterprises will not be easy. The greater the price fluctuation, the greater the impact on the national economy and society. Reflected in the pig farming industry, the industry has been losing money. Mr. Li, a Laixi farmer, told reporters that since late April, his pig farm began to enter a loss period. Recently, the price of pigs has fallen below 6.5 yuan/jin, and his self-support cost line is 9.2 yuan/jin. According to the weight of 220 jin, the loss has expanded from more than 300 yuan in the previous period to nearly 700 yuan at present. In order to reduce losses, he has been reducing the number of sows he can breed in recent months, from 1300 to 400. The scale of farming enterprises is also difficult. According to the relevant person in charge of the Qingdao Agricultural and Rural Bureau, affected by the price drop, the city's leading pig breeding enterprises, such as Dabei Nong, Zhengda, New Hope Liuhe, and New Wanfu, have also suffered losses to varying degrees and are gradually reducing the amount of breeding.

Pig prices in 4 months to complete the waist cut, "pig cycle" time shortened.

According to the statistical survey and monitoring data of the National Development and Reform Commission, since March, the ex-factory price of live pigs across the country has been "falling endlessly". Specifically, in March 2021, the national price of live pigs was 28.81/kg, -9.6 month on month and -21.1 year on year. In April, the national price of live pigs was 24.73/kg, -14.2 month on month and -27.4 year on year. In May, the national price of live pigs was 21.33/kg, -13.7 month on month and -29.3 year on year. In June, the national price of live pigs was 16.5 yuan/kg, -22.6 month on month, yoY -48.5%; In July, the national pig exit price was 16.43 yuan/kg, 0.4% month-on-month, 55.2% YoY. It can be found that it took only four months for pig prices to fall sharply to "halve" compared with the same period last year, which is not rapid. On the other hand, the rapid recovery of production capacity, the rapid decline in prices, short time, has become a significant feature of this round of "pig cycle. Experts said pork prices in the current pig cycle rose in tandem with hog prices, climbing to a record high of 59.64 yuan per kilogram in the third week of February 2020, up 164.5 percent year-on-year. At the same time, it took more than a year and a half for pig production to basically recover from a severe landslide, which is also the **short natural production cycle from the reserve sow to the pig market. It took 16 months for pork prices to return to normal from the **point, which is 6 months shorter than the previous rounds of" pig cycles.

Only the gods know when to see the bottom.

So, when can the shortened version of the pig cycle "shrink", and whether it can quickly cut off the price fluctuations of the pig industry "cancer"? The answer is still confusing. Listed pig companies are the industry scale, cost, technology, management and other advantages of the **, which also gives them a stronger ability to respond to the pig cycle. In the first half of 2021, the national pig column volume of 337.42 million head, of which Muyuan shares, Zhengbang Technology, Wen's shares, New Hope, Tianbang shares and other five A- share listed enterprises a total of 35.4335 million head, accounting for 10.5 percent, can be called A- share listed pig enterprises TOP5. However, the advantages of listed companies are still somewhat inadequate in the face of the "pig cycle. The semi-annual report shows that among the five major pig enterprises, except for Muyuan shares, the rest of the pig enterprises are in a state of loss. Regarding the main reason for the decline in net profit, most pig companies stated in their semi-annual reports that pig prices continued to fall in the first half of this year, feed prices were high, and the rapid expansion of pig companies and a certain degree of decline in management efficiency also affected the profits of pig companies.

On the other hand, for investors concerned about when the price of pigs bottomed out, listed pig companies also have no idea. Recently, on the interactive platform of Shenzhen Stock Exchange, for investors, "when does the company think the pig price will bottom out? Does the company have such foresight?" jin Xinnong replied, "The pig industry has entered a downward pig cycle. Only the gods know when it will bottom out! Maybe after half a year next year? Or the first half of the year?" in fact, judging from the previous pig cycles in recent years, the incentives are complex, including various contradictory factors such as African swine fever, unreasonable local bans and restrictions, and environmental protection. In addition, the profits of pig companies are also affected by feed costs and management efficiency. And other multiple factors. Industry insiders told reporters that from May last year to February this year, when the pig cycle was running at a high level, the pig could be sold for 16-20 yuan per catty, and the net profit of a self-bred pig was 3000 yuan. The net profit of fattening pigs can also reach 1,000 700 or 800 yuan. Even if the fluctuation of the pig cycle is taken into account, pig farming is still the most profitable in traditional domestic livestock and poultry farming.

Multi-pronged smooth "pig cycle", market bottom yet to be ground

Xin Guochang, the second-level inspector of the Animal Husbandry and Veterinary Bureau of the Ministry of Agriculture and Rural Affairs, said in an interview with the media recently that moderate price fluctuations are a manifestation of the market's adjustment of resource allocation. Major pig-raising countries in the world, such as the United States and Brazil, also have "pigs." Cycle ", but once there is a sharp rise and fall in prices, it will have some negative effects on the pig industry and even the national economy and social stability, so we don't want it to go up and down, up and down, and try to make it fluctuate more smoothly. What is clear is that the state's regulation of the pig market has shown a multi-pronged intensive situation in recent months. On June 9, with the approval of the State Council, the National Development and Reform Commission and other departments jointly issued the "Work Plan for Improving the Government's Pork Reserve Adjustment Mechanism and Doing a Good Job in Guaranteeing Supply and Price Stability in the Pork Market." According to the new policy, the pig-to-grain ratio is less than 5:1, and the collection and storage will be fully started. In July, China launched three central reserve frozen pork purchasing and storage bidding transactions, pushing up prices. Against this backdrop, hog and hog futures prices once stopped falling and rebounded. On August 6, the Ministry of Agriculture and Rural Affairs and other six departments issued the Opinions on Promoting the Sustainable and Healthy Development of the Pig Industry. The opinions proposed: stabilize the pig loan policy, and not arbitrarily restrict, withdraw, or cut off loans; strengthen the regulation of pork reserves and maintain A certain amount of government pork regular reserves; it will take 5-10 years to maintain the pork self-sufficiency rate at about 95%; implement the pig breeding subsidy project to accelerate the process of breed improvement; establish a counter-cyclical regulation mechanism for pig production to promote the sustainable and healthy development of the industry.

On September 16, the National Development and Reform Commission stated that preliminary statistics show that 17 provinces have carried out or started purchasing and storage work, and other places will also carry out purchasing and storage in the fourth quarter. The total number of purchasing and storage in various regions has increased significantly, and the intensity has increased significantly. In the next few months, as the effect of purchasing and storage "supporting the market" gradually appears, superimposed on the increasing consumption of pork in autumn and winter and the two festivals, and the demand increases, the price of live pigs may gradually rise. In the next step, our committee will continue to closely track and monitor the replenishment of breeding sows, the changes in the stock of live pigs and the trend of pork prices, and strengthen analysis and judgment; and will work with relevant departments to further study the adoption of cross-cyclical measures such as import regulation to promote the smooth operation of the live pig market.

Institutions believe that the follow-up with the national market signal issued, is expected to ease the breeding end panic, the market downward space is limited. Industry insiders said frankly that the price of live pigs is hard to rise rapidly, and there will be a long time to grind the bottom. It is the best choice for enterprises to keep the existing market pattern and wait for the counterattack.