Sou Hu Cai Jing·2025-07-24 01:56Core Viewpoint - The pig farming sector is experiencing a rebound driven by "anti-involution" policies, leading to significantly enhanced expectations for capacity optimization [1][4]. Group 1: Policy and Capacity Optimization - The core issue facing the pig industry is overcapacity, with the breeding sow inventory reaching 40.43 million heads as of June 2025, which is 103.7% of the normal holding level [4]. - Policies are being implemented to control production capacity, including a directive to reduce the breeding sow count by 1 million heads to a target of 39.5 million [6]. - The Ministry of Agriculture and Rural Affairs is monitoring the market, indicating a 0.8% decrease in the inventory of pigs over 5 months old in June, suggesting a potential reduction in pig output in July and August [6]. Group 2: Industry Restructuring and Competitive Advantages - The "anti-involution" policy is reshaping the competitive landscape, accelerating the exit of inefficient production capacities, which benefits quality listed pig companies [7]. - Cost competition is becoming crucial, with leading companies like Shennong Group, Muyuan Foods, and Wens Foodstuff Group achieving production costs as low as 12-12.5 yuan per kilogram, providing them with a long-term competitive edge [7]. - Recent earnings forecasts from 14 listed companies indicate that 11 expect profit increases, with Muyuan Foods projecting a 1190% year-on-year growth in net profit for the first half of the year [7][8]. Group 3: Market Performance and Investment Opportunities - The DCE pig futures surged by 1.67% on July 23, reaching a new high for the year, while the livestock farming ETF (516670) rose by 3.37% over the week, with a cumulative net inflow of 115 million yuan [1]. - The SW Agricultural, Forestry, Animal Husbandry, and Fishery Index's price-to-book ratio is approximately 2.53 times, still relatively low compared to historical levels, indicating potential for investment [1][4].