供压持续高位，行业亏损加剧

1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - In the long - term, the number of breeding sows continued to decline in Q4 2025, reaching 39.61 million by December, but the reduction was still lower than the regulatory target, and the basic production capacity remained excessive. However, with the piglet price entering the loss range during the peak season and the pig price falling below the cash cost, capacity reduction is expected to accelerate. In the medium - term, the theoretical supply of standard pigs will remain high and stable until August, but there may be a short - term reduction in May and June due to the decrease in piglet births in November and December last year. Feed production and sales show seasonal fluctuations, indicating stable future supply. Currently in the off - season, real demand is weak, second - round fattening demand is cautious, and the frozen product storage rate has risen as the pig price drops. In the short - term, the average slaughter weight is still high, with group farms starting to actively reduce inventory and散户 still passively holding pigs. Overall, the oversupply situation continues, and a fundamental reversal of the spot market requires the average weight to drop to a reasonable level. Pig prices below the cash cost will accelerate capacity reduction. For trading, near - term contracts should be treated as oscillating weakly, with strategies of short - selling on rebounds or selling out - of - the - money call options. Contracts in 2027 will be supported by capacity reduction expectations, and investors should wait for the right - side long - allocation opportunity after accelerated capacity reduction [3][26]. 3. Summary by Relevant Catalogs 3.1 Market Review - Since Q1, the live hog spot market has shown a downward trend. The national average price of standard pigs was around 13 yuan/kg at the beginning of the quarter, briefly strengthened in mid - to - late January, and then entered a downward channel, falling below 10 yuan. The futures market led the spot market. The LH2603 contract fell first, mainly due to the post - holiday off - season in March with the greatest supply - demand contradiction. The LH2605 contract first weakened oscillatingly, then traded sideways from February to mid - March, and started a new round of decline after breaking through the support level in the second half of March. Overall, the oversupply fundamental situation dominated the Q1 live hog market. Futures contracts for May, July, and September were relatively resistant to decline due to the expected marginal reduction in supply and maintained a high premium. Eventually, as the inventory reduction in the spot market was slow, the futures market reshaped its valuation through price drops [5]. 3.2 Live Hog Supply and Demand Analysis 3.2.1 Potential Acceleration of Breeding Sow Culling, High and Stable Piglet Births - According to statistics, the national inventory of breeding sows reached a peak of 40.8 million in November 2024 and then declined. By the end of December 2025, it was 39.61 million, a 2.9% reduction from the peak. The rebound in piglet prices since January turned the piglet sales profit positive, which may have a negative impact on the culling speed of breeding sows. Some sample statistics showed an increase in the inventory of breeding sows in February, which remained stable. However, since March, as the pig price fell, the piglet price weakened, and the culling of breeding sows may accelerate. Piglet births have been at a high level since September last year. Although there was a decline in November and December, it was mainly a seasonal decrease. Based on the time cycle, the theoretical standard pig slaughter volume will be high until August [7]. 3.2.2 Seasonal Decrease in Feed Sales, Overall Stability - From the data of live hog feed production and sales, the sales volume of piglet feed decreased month - on - month from October to December 2025, rebounded in January, and declined again in February, which was mainly normal seasonal fluctuation without an obvious trend. The month - on - month growth rate of fattening pig feed sales turned negative from December 2025 to February 2026, with a decline similar to the same period of the previous year. From the feed perspective, the overall inventory of live hogs in society remained relatively stable, and the future slaughter pressure was still large [10]. 3.2.3 High Average Slaughter Weight, Weakening Price Difference between Fat and Standard Pigs - According to sample statistics, the national average slaughter weight of live hogs increased seasonally after the Spring Festival and was still at a high level year - on - year. By the end of March, the average weight of group farms was 125.71 kg, the same as the previous year, while the average weight of散户 hogs rebounded to 144.6 kg, an increase of about 8 kg year - on - year. The price difference between fat and standard pigs dropped rapidly during the Spring Festival, lower than last year but higher than the year before. Overall, the inventory reduction of live hogs was difficult, and the supply pressure persisted [12]. 3.2.4 Low - price Stimulation of Slaughter Increase, Continuous Increase in Frozen Product Inventory - After the Spring Festival, the slaughter volume increased seasonally, with a steeper increase in March, mainly due to low - price stimulation. The fresh sales rate weakened seasonally after the Spring Festival and was at a low level year - on - year, indicating weak real demand. Most slaughter enterprises had a psychological price of less than 10 yuan for active storage. In March, as the pig price approached 10 yuan, some enterprises carried out storage, and the frozen product storage rate rose to the highest level in the same period in the past three years [16]. 3.2.5 Continuous Industry Losses, Slight Increase in Costs - Since 2026, the pig price briefly rebounded and then fell rapidly, and the live hog breeding profit entered the loss state again. By the end of March, the loss of self - breeding and self - fattening was about 300 yuan per head. Since the second half of September last year, the loss period at the bottom has reached 5 months. Currently, the self - breeding and self - fattening cost is over 12 yuan per head, slightly higher than before, mainly due to the increase in feed raw material prices [21]. 3.3 Conclusion and Market Outlook - Similar to the core viewpoints, it emphasizes the long - term, medium - term, and short - term situations of the live hog market, the current oversupply situation, and corresponding trading strategies [26].