Muyuan Foods (SZ:002714) Dongxing Securities·2025-12-24 12:13Investment Rating - The industry investment rating is "Positive" [2] Core Insights - In November, the average price of live pigs continued to decline, but the rate of decline narrowed. The average prices for piglets, live pigs, and pork were 24.25 CNY/kg, 12.55 CNY/kg, and 23.05 CNY/kg respectively, with month-on-month changes of -5.99%, -0.20%, and -1.54% [3][18] - The supply side showed active slaughtering, with competitive pressure on large-scale enterprises. The overall supply was loose, while the demand side lacked strong support, leading to a decrease in the slaughtering rate [21] - The production capacity is on a downward trend, with the number of breeding sows decreasing to 39.90 million heads by the end of October, a month-on-month decline of 1.10% [4][27] - The industry is expected to see accelerated capacity reduction due to policy adjustments and ongoing losses in breeding operations, with a potential price rebound anticipated in the second half of 2026 [5][31] Summary by Sections Supply and Demand Performance - In November, the slaughtering rate of live pigs decreased by 0.30 percentage points to 34.12%, indicating a lack of strong demand support [21] - The average slaughter weight of pigs slightly declined, with the average post-slaughter weight around 88 kg [21] Capacity Changes - The number of breeding sows has been decreasing, with a reported 39.90 million heads by the end of October, reflecting a trend of capacity reduction [4][27] - The policy environment is focused on capacity control, which is expected to accelerate the reduction of less efficient production capacity [5][27] Market Outlook - The industry is expected to experience a turning point in prices in the second half of 2026, with leading companies like Muyuan Foods expected to benefit from cost advantages [5][32] - The industry index price-to-book ratio (PB) has shown some recovery but remains below historical median levels, indicating a safety margin for valuations [5][32] Sales Data - In November, major companies reported mixed sales performance, with Muyuan Foods, Wens Foodstuffs, and others showing slight month-on-month changes in sales prices [34][37] - The total sales volume for listed pig companies in November decreased by 2.90% month-on-month but increased by 27.01% year-on-year [43]