Shenwan Hongyuan Securities·2025-11-23 13:06Investment Rating - The report indicates a cautious investment outlook for the agricultural sector, particularly highlighting the need to focus on capacity reduction in the pig farming industry due to ongoing losses and low prices [1][2]. Core Insights - The agricultural index fell by 3.4% this week, with significant individual stock movements, including a notable increase in companies like Zhongshui Fishery (61.0%) and Quanyin High-Tech (27.4%) [1][2]. - The report emphasizes the ongoing losses in pig farming due to low prices, suggesting that the industry is entering a phase of accelerated capacity reduction, which may present left-side investment opportunities [1][2]. - The pet food sector showed strong sales performance during the "Double Eleven" shopping festival, indicating growth potential for leading companies in this space [1][2]. Summary by Sections Pig Farming - The report notes a decline in pig prices, with the average price for external three yuan pigs at 11.61 yuan/kg, reflecting a week-on-week increase of 0.43% but a decrease of 2.11% compared to the previous week [1]. - Losses for self-breeding sow enterprises have increased, with losses reported at 96.61 yuan per head, a week-on-week increase of 24.66 yuan [1]. - The report anticipates continued pressure on pig supply through Q4 2025 and into H1 2026, with prices likely to remain low [1]. Pet Food - October data shows a decline in China's pet food exports, with a total export value of 772 million yuan (approximately 109 million USD), down 15.8% year-on-year [1]. - Despite short-term challenges due to trade friction, the domestic pet food market is expected to continue its growth trajectory, with a focus on leading brands [1][2]. Chicken Farming - The report highlights stable prices for white feather broiler chicks and chicken meat, with the average price for chicks at 3.35 yuan each and for chicken meat at 3.50 yuan/kg [1]. - The supply of broilers is expected to remain ample, but improvements in demand due to economic recovery could lead to a rebound in industry profitability [1].