Core Insights - The livestock industry is experiencing a trend of reduced competition, compounded by the African swine fever outbreak, leading to increased capital inflows into the sector [1] - China Galaxy Securities predicts a year-on-year decline in average pig prices for 2025, with notable differences due to the optimization of production costs by leading pig companies, resulting in unexpected breeding profits [1] Group 1: Market Performance - As of October 29, 2025, the China Livestock Breeding Index (930707) shows significant stock price increases for several companies: Weilan Bio (603739) up 10.00%, Meinong Bio (301156) up 6.73%, and Luoniushan (000735) up 4.83% [1] - The Livestock ETF (159867) has seen a mixed market performance, with the latest price at 0.66 yuan, and has experienced continuous capital inflows over the past 10 days, totaling 47.796 million yuan [1] Group 2: Industry Dynamics - The average pig price has fallen to the cash cost line, creating cash flow pressures for breeding entities, which may accelerate capacity reduction in the industry [1] - The top ten weighted stocks in the China Livestock Breeding Index, as of September 30, 2025, include Muyuan Foods (002714) and Wens Foodstuff Group (300498), collectively accounting for 66.06% of the index [2]

Group 1 - The livestock ETF (159865) rose over 1.5% in early trading on August 26, indicating positive market sentiment towards the livestock sector [1] - According to Galaxy Securities, the average pig price in 2025 is expected to remain relatively stable, with differences arising from the continuous optimization of the total costs by leading pig companies, resulting in profits exceeding expectations [1] - Key factors to monitor in 2025 include changes in pig company production capacity, industry breeding conditions, and slaughter weights, which may lead to unexpected variations [1] Group 2 - In July, the Consumer Price Index (CPI) remained flat year-on-year, while the cumulative trade deficit for agricultural products decreased by 16% [1] - China's agricultural product import value in July was $18.678 billion, a year-on-year increase of 5.14%, while export value was $8.385 billion, up 1.59%, resulting in a trade deficit of $10.293 billion, which is an increase of 8.21% year-on-year [1] - The livestock ETF (159865) tracks the CSI Livestock Index (930707), which selects listed companies involved in livestock feed, breeding, animal vaccines, and veterinary drugs, reflecting the overall performance of the livestock sector [1]