Core Viewpoint - The recent decline in pig prices has been observed, with live pig and pork prices dropping for six consecutive weeks, while piglet prices have decreased for 15 weeks. Despite this, pig farming has remained profitable due to lower breeding costs [1][6]. Price Trends - From January to August, live pig prices shifted from an upward trend to a downward trend, with a significant year-on-year decline of 31.4% by the second week of August, reaching 14.35 yuan/kg [1][2]. - Pork prices also experienced a decline, falling to 24.93 yuan/kg by the third week of August, reflecting a year-on-year decrease of 22% [2]. - Piglet prices rose from 32.77 yuan/kg to 39.57 yuan/kg from January to April, but have since dropped to 33.25 yuan/kg by August, marking a year-on-year decline of 25.4% [2]. Supply and Demand Analysis - The recent drop in pig prices is attributed to a normal correction following a temporary price surge in June, driven by seasonal demand and reduced slaughter volumes [3]. - The supply of live pigs has increased, with a 14.5% year-on-year rise in slaughter volumes from January to June [3]. - Despite some recovery in pork consumption due to seasonal factors, overall demand remains weak, limiting support for pig prices [5]. Cost and Profitability - Breeding costs have decreased, allowing pig farming to remain profitable for 15 consecutive months, although profit margins are expected to narrow starting from the fourth quarter of 2024 [6][7]. - The average profit per head of live pig from January to July was approximately 110 yuan, dropping below 100 yuan in July [7]. Future Outlook - The supply of live pigs is expected to continue growing into the third quarter and early next year, with a potential seasonal increase in demand starting in September [8]. - The government plans to initiate a new round of frozen pork storage by the end of August, which may boost market confidence [8]. - The pig farming industry is anticipated to maintain profitability, but farmers are advised to manage production capacity and risks effectively [8].

Investment Rating - The investment rating for the company is "Accumulate" (maintained) [2] Core Views - The company has shown a stable growth in pig and chicken farming, with a focus on improving quality and efficiency. The forecasted net profits for 2025-2027 are 9.494 billion, 12.556 billion, and 13.688 billion RMB respectively, with corresponding PE ratios of 12.7, 9.6, and 8.8 times [7][8] Financial Performance - For the first half of 2025, the company reported a revenue of 49.875 billion RMB, a year-on-year increase of 5.92%, and a net profit of 3.475 billion RMB, a significant increase of 159.12% [7] - The average selling price for pork was 14.93 RMB/kg, down 2.56% year-on-year, with a total of 16.6166 million pigs sold, an increase of 15.6% [7] - The revenue from pork sales reached 32.735 billion RMB, up 16.26% year-on-year [7] - The average selling price for broilers was 10.84 RMB/kg, down 18.43% year-on-year, with 598 million chickens sold, an increase of 9.16% [7] - The company recorded a cash flow from operating activities of 6.465 billion RMB, an increase of 11.3% year-on-year [7] Profit Forecast - The projected revenue for 2025 is 95.200 billion RMB, with a revenue growth rate of -9.2% [6] - The projected net profit for 2025 is 9.494 billion RMB, with a net profit growth rate of 2.9% [6] - The company’s return on equity (ROE) is expected to be 19.5% in 2025, with a projected price-to-book (PB) ratio of 2.5 [6] Market Position - The company is a leading player in the pig and yellow feather chicken farming industry, with a focus on sustainable development and efficiency improvements [7]

Core Viewpoint - The recent decline in pig prices is attributed to a combination of increased supply and reduced demand, with the industry still maintaining profitability due to lower breeding costs [1][4]. Price Trends - Pig prices have been on a downward trend for six consecutive weeks, with prices dropping from 16.57 CNY/kg in early January to 14.35 CNY/kg by early August, marking a year-on-year decline of 31.4% [1]. - Pork prices also decreased from 27.75 CNY/kg in January to 24.93 CNY/kg in August, reflecting a year-on-year drop of 22% [2]. - The price of piglets rose from 32.77 CNY/kg to 39.57 CNY/kg between January and April, but has since fallen to 33.25 CNY/kg by August, down 25.4% year-on-year [2]. Supply and Demand Dynamics - The slaughter volume of pigs increased by 14.5% year-on-year, reaching 18.355 million heads from January to June [3]. - Pork imports from January to July totaled 62.6 thousand tons, a 4.1% increase year-on-year, although July saw a slight decline [3]. - Despite some recovery in restaurant consumption due to seasonal factors, overall demand for pork remains weak, limiting price support [3]. Profitability and Future Outlook - Breeding profitability has been maintained for 15 consecutive months, with average profits per head around 110 CNY from January to July, although this has decreased to below 100 CNY in July [4]. - The supply of pigs is expected to continue growing into the third quarter, while demand is anticipated to pick up starting in September, particularly with the upcoming seasonal consumption peaks [4]. - The government plans to initiate a new round of frozen pork storage by the end of August, which may boost market confidence [4].

Group 1 - The core viewpoint is that the pig farming industry has maintained profitability in the first half of the year due to declining breeding costs and some farmers successfully locking in profits through stable operating models [1][2] - In the first half of the year, the average price of live pigs was 15.50 yuan per kilogram, a year-on-year decrease of 0.8%, primarily due to a significant increase in the number of pigs being sold compared to the previous year [1][2] - The slaughter volume of large-scale pig slaughtering enterprises from January to May was 15,349.67 million heads, with May's slaughter volume at 3,215.67 million heads, reflecting a month-on-month increase of 4.5% and a year-on-year increase of 20.6% [1] Group 2 - The recent rebound in pig prices is driven by multiple favorable factors, including the clearance of large pigs and the conversion of some fresh pork to frozen products, which alleviated supply pressure [2] - The average prices of feed and raw materials for pig farming, such as corn and soybean meal, decreased by 9.2%, 8.8%, and 6.4% year-on-year, respectively, contributing to sustained low breeding costs [2] - The overall pig farming industry has been in a downward price cycle for nearly two years, but some local governments have actively supported farmers, leading to stable profits for certain farmers [2] Group 3 - The outlook for pig prices suggests a potential rebound in the third quarter, although the extent of this rebound may be limited due to continued ample production capacity [3] - The number of newborn piglets has been increasing since the second half of last year, indicating that pig supply will remain abundant into the second half of 2025 [3] - Seasonal recovery in pork consumption is expected as the market stabilizes, with government policies encouraging farmers to control the weight of pigs at the time of sale [3]

Group 1 - The livestock ETF (516760) has risen by 0.46%, marking a five-day consecutive increase, with significant gains in constituent stocks such as Brother Technology (002562) up 10.02%, Xinghuo Technology (600866) up 4.12%, and others [1] - Listed pig companies have begun releasing their 2025 semi-annual performance forecasts, indicating a continued high profit growth in Q2 2025. For instance, Muyuan Foods expects a net profit attributable to shareholders of 10.2-10.7 billion yuan for H1 2025, representing a year-on-year increase of 1129.97% to 1190.26% [1] - In Q2 2025, Muyuan Foods anticipates a net profit of 5.7-6.2 billion yuan, reflecting a year-on-year growth of 77.95% to 93.53%, with a total of 24.252 million pigs sold, an increase of 48.08% [1] Group 2 - The livestock ETF closely tracks the CSI Livestock Breeding Index, which includes companies involved in livestock feed, veterinary drugs, and breeding, reflecting the overall performance of related listed companies [2] - The latest price-to-earnings ratio (PE-TTM) of the CSI Livestock Breeding Index is 13.34 times, which is at a historical low, being in the 11.27% percentile over the past three years, indicating a valuation lower than 88.73% of the time in the last three years [2] - The current valuation of the sector remains low, providing a high margin of safety, suggesting that investors should actively consider the livestock ETF (516760.SH) [2]

Core Viewpoint - The company expects significant profit growth in H1 2025, with net profit projected between 10.5 to 11 billion yuan, representing a year-on-year increase of 925% to 973% [1] Group 1: Performance Forecast - The company anticipates a net profit of 10.2 to 10.7 billion yuan for H1 2025, reflecting a year-on-year increase of 1130% to 1190% [1] - Earnings per share (EPS) is projected to be between 1.9 to 2.0 yuan per share [1] Group 2: Sales and Production - In H1 2025, the company sold 38.394 million pigs, a year-on-year increase of 33%, and 8.291 million piglets, a year-on-year increase of 168% [2] - The company sold 225,000 breeding pigs, which is a year-on-year decrease of 28% [2] - As of the end of H1, the breeding sow inventory was 3.431 million, a decrease of approximately 54,000 from the end of Q1 [2] - The current sales volume is about 49% to 53% of the annual target of 72 to 78 million pigs, indicating a stable overall pace [2] Group 3: Cost and Pricing - The average weight of sold pigs increased until May, but showed a month-on-month decrease in June, with expectations of continued weight reduction [2] - The company's breeding cost per kilogram of pigs decreased to 12.1 yuan/kg in June, down 1 yuan/kg from January, indicating significant cost advantages [2] - The average selling price of pigs in H1 was approximately 14.5 yuan/kg, a year-on-year decrease of 3%, primarily due to a significant price rebound starting from Q2 2024 [2] Group 4: Revenue and Profit Forecast - The company forecasts revenues of 140.35 billion, 143.52 billion, and 152.70 billion yuan for 2025 to 2027, respectively [3] - Expected net profits for the same period are projected to be 23.905 billion, 25.578 billion, and 28.435 billion yuan, respectively [3] - Corresponding price-to-earnings (PE) ratios are estimated at 10.31, 9.63, and 8.66 times [3]

Core Viewpoint - The domestic pig market is experiencing fluctuations, with prices showing a recent rebound after a period of decline, but overall demand remains weak, leading to concerns about future price stability [1][3][5] Group 1: Market Trends - As of June 23, the main contract for live pig futures reached 13,975 yuan/ton, up nearly 5% from the low of 13,350 yuan/ton at the beginning of the month [1] - The overall price of live pigs has been on a downward trend since the third quarter of 2024, currently at relatively low levels [1] - The average price of live pigs nationwide rose to 14.22 yuan/kg by June 20, following a drop to 13.94 yuan/kg on June 9 [1] Group 2: Supply and Demand Dynamics - The demand for live pigs has weakened, leading to an oversupply situation that has caused prices to drop significantly [1][3] - The average trading price for 7 kg piglets in Hunan fell to 460 yuan/head by June 19, a decrease of 85 yuan/head or 15.6% since early May [2] - The increase in feed costs, particularly for corn and soybean meal, has further pressured the profitability of pig farming [3] Group 3: Profitability and Cost Analysis - As of June 19, the average profit for self-breeding pigs was 137.93 yuan/head, down 66.12 yuan/head from early April, while the profit for piglets was 153.42 yuan/head, down 151.05 yuan/head [3] - The average feed cost for self-breeding pigs was 934.88 yuan, and for piglet fattening, it was 889.94 yuan, both showing increases from early April [3] Group 4: Slaughtering Trends - The daily slaughter volume for sample enterprises remained stable, with a range between 165,000 to 186,000 heads, influenced by increased supply and the profitability of fresh meat segmentation [4] - The average gross profit per head for slaughtering was 28.56 yuan, up 222.38% compared to the same period last year [4] Group 5: Future Outlook - The market is expected to face continued downward pressure on prices due to increased slaughtering rates and weak demand, although there are signs of improved market sentiment [5] - The third quarter may see a seasonal decline in pig stocks, potentially supporting higher average prices compared to the second quarter [4]

Group 1 - The average price of pork in China's wholesale market has decreased by 9.3% from January to May, indicating a downward trend in pork prices this year [1] - The prices of live pigs and pork have dropped from 16.57 yuan/kg and 27.75 yuan/kg in January to 14.93 yuan/kg and 25.68 yuan/kg in May, with cumulative declines of 9.9% and 7.5% respectively [1] - The price of piglets has increased by 19% this year, rising from 32.77 yuan/kg in January to 39.01 yuan/kg in May, although there has been a recent slight decline in the growth rate [1][2] Group 2 - The recovery in consumer demand has supported pork prices despite a significant increase in the supply of commodity pigs [2] - From January to April, the number of pigs slaughtered increased by 10.9% year-on-year, with April showing a 20% increase compared to the same month last year [2] - The decline in frozen product inventory has boosted the demand for fresh pork in the catering sector [2] Group 3 - The pig farming industry remains profitable, with average profits per head dropping below 100 yuan as of April 2025, despite a decline in pork prices [3] - Production costs for pig farming are at their lowest since 2019, aided by lower feed prices and improved breeding efficiency [3] - The number of breeding sows has increased slightly, indicating a potential rise in pig supply in the second half of the year [3] Group 4 - Seasonal price increases for pork are expected in the second half of the year, but the year-on-year growth will be significantly lower than in previous years [4] - Farmers are advised to manage their sales strategies carefully to avoid high costs associated with piglet purchases and secondary fattening [4]

Investment Rating - The report maintains a "Buy" rating for the industry, particularly recommending stocks like Muyuan, Wens, and New Hope due to their competitive cost structures and potential for excess returns in the pig farming sector [1]. Core Insights - The report highlights a 2% week-on-week decline in live pig prices, with a significant year-on-year increase of 37.9% in the output of 20 listed pig companies in April [2]. - The report indicates that the breeding stock of sows has increased, suggesting a potential for normal profitability in pig farming in 2025, despite entering a downward price cycle [2]. - The report emphasizes the historical low valuations of leading pig farming companies, suggesting that they are well-positioned for recovery [2]. Summary by Sections 1. Market Overview - The agricultural sector index increased by 0.05% in the week of May 12-16, 2025, underperforming compared to the Shanghai Composite Index [14]. - The agricultural sector ranks 7th among 31 sub-industries in terms of performance since the beginning of 2025, with a year-to-date increase of 3.54% [14]. 2. Industry Data 2.1 Primary Agricultural Products - Corn prices are reported at 2374.90 CNY/ton, showing a week-on-week increase of 0.48% but a year-on-year decrease of 1.63% [35]. - Soybean prices remain stable at 3927.89 CNY/ton, with a year-on-year decline of 10.48% [35]. 2.2 Livestock - The average weight of pigs at slaughter remains stable at 129.71 kg, which is higher than the same period in 2023 and 2024 [2]. - The report notes that the output of listed pig companies reached 69.18 million heads in the first four months of 2025, marking a 30.1% year-on-year increase [2]. 3. Company Performance - The report lists the output of major listed pig companies, with Muyuan leading at 30.77 million heads, followed by Wens and New Hope [2]. - The report suggests that the introduction of new products in the pet food sector is driving rapid growth for domestic companies like Zhongchong and Guobao [5]. 4. Global Agricultural Trends - The global corn stock-to-use ratio for 2025/26 is projected to be the lowest since the 2015/16 season, indicating tightening supply conditions [3]. - The report forecasts a decrease in the global soybean stock-to-use ratio, reflecting similar trends in the corn market [3].

Core Viewpoint - The livestock farming sector is experiencing a positive trend, with an extended profit period expected for pig farming, driven by improved demand and favorable pricing dynamics [1][2]. Group 1: Market Performance - As of May 7, 2025, the China Livestock Breeding Index (930707) increased by 0.20%, with key stocks such as Shengnong Development (002299) rising by 1.89% and Yiduoli (300381) by 1.75% [1]. - The Livestock ETF (516760) rose by 0.16%, with a recent price of 0.63 yuan, and has seen a cumulative increase of 7.19% over the past three months, ranking in the top 25% among comparable funds [1]. - The average price of pork in national wholesale markets reached 20.96 yuan/kg on May 6, 2025, marking a 1.8% increase compared to pre-holiday levels [1]. Group 2: Financial Performance - In 2024, pig farming enterprises are projected to generate revenues of 437 billion yuan, a year-on-year decline of 1.28%, while net profit attributable to shareholders is expected to rise by 337.73% to 32 billion yuan [1]. - In Q1 2025, pig farming enterprises achieved revenues of 107.88 billion yuan, reflecting an 18.69% year-on-year increase, with industry net profit reaching 7.91 billion yuan, up 236.12% year-on-year [1]. Group 3: Supply and Demand Dynamics - As of Q2 2025, domestic demand for pigs is showing marginal improvement, with price support and a gradual transition into a phase of price increases [2]. - External factors, including rising feed raw material prices due to tariffs and increased costs of imported meat, are also contributing to favorable pricing for pigs [2]. Group 4: Valuation Metrics - The Livestock ETF, which tracks the China Livestock Breeding Index, has a current price-to-earnings ratio (PE-TTM) of 12.38, placing it in the 1.74% percentile over the past year, indicating a valuation lower than 98.26% of the time in the last year [2]. - The China Livestock Breeding Index includes companies involved in livestock feed, veterinary drugs, and livestock farming, reflecting the overall performance of related listed companies [2]. Group 5: Top Weighted Stocks - As of April 30, 2025, the top ten weighted stocks in the China Livestock Breeding Index include Haida Group (002311), Muyuan Foods (002714), and Wens Foodstuff Group (300498), collectively accounting for 69.38% of the index [2].