Dongguan Securities·2025-05-09 10:15Investment Rating - The report maintains an "Overweight" rating for the agriculture, forestry, animal husbandry, and fishery industry [50] Core Insights - The report indicates that the breeding capacity of sows is expected to continue to decrease, with further potential for reduction in the future. The current valuation of the pig farming sector is at historical lows, presenting opportunities for low-position investments based on capacity reduction expectations [50] - In the poultry farming sector, the impact of avian influenza has limited the introduction of breeding stock for white feather chickens, leading to expectations of capacity reduction. Attention is drawn to leading companies in high-quality white feather chicken farming, while yellow feather chicken farming is expected to see profit improvements due to declining breeding costs [50] - In the feed sector, raw material cost pressures are expected to ease, and the concentration of leading companies is likely to continue to increase [50] - In the seed industry, trade frictions highlight food security concerns, and the commercialization of genetically modified organisms is progressing, with a focus on leading companies with research and development advantages [50] - The domestic pet market is expanding rapidly, with a focus on leading companies that cater to domestic demand [50] Industry Performance Review - The SW agriculture, forestry, animal husbandry, and fishery industry underperformed the CSI 300 index, with an increase of 0.32% from April 25 to May 8, 2025, lagging behind the index by approximately 1.49 percentage points [16] - Among the sub-sectors, only feed and breeding recorded negative returns, down 0.08% and 1.02% respectively, while animal health, fishery, planting, and agricultural product processing saw positive returns of 5%, 2.19%, 2.08%, and 2% respectively [17][18] - Approximately 72% of stocks in the industry recorded positive returns during the same period [18] - As of May 8, 2025, the overall price-to-book (PB) ratio of the SW agriculture, forestry, animal husbandry, and fishery industry index was about 2.58 times, slightly recovering over the past two weeks, and remains at 57.2% of the historical valuation center since 2006, indicating a historical low [22] Key Industry Data - Pig Farming: The average price of external three yuan pigs decreased slightly from 14.99 yuan/kg to 14.90 yuan/kg between April 25 and May 8, 2025. The breeding sow inventory reached 40.39 million heads at the end of March 2025, a decrease of 0.66% month-on-month but an increase of 1.2% year-on-year, indicating a normal holding level of 103.6% [26] - Cost: As of May 8, 2025, the spot price of corn was 2360.98 yuan/ton, showing a slight increase, while the spot price of soybean meal was 3300 yuan/ton, showing a slight decrease [28] - Profitability: As of May 9, 2025, the profit from self-breeding and self-raising pigs was 84.33 yuan/head, slightly down from the previous week, while the profit from purchasing piglets was 58.46 yuan/head, slightly up from the previous week [31] - Poultry Farming: The average price of broiler chicks in major production areas was 2.91 yuan/chick, showing a slight increase, while the average price of white feather broilers was 7.45 yuan/kg, showing a slight decrease, with a profit of -0.1 yuan/chick [33][36] - Aquaculture: The average wholesale price of crucian carp was 20.68 yuan/kg, and for carp, it was 14.29 yuan/kg, remaining stable over the past two weeks [38]