Report Industry Investment Rating - Not provided in the content Core Viewpoints of the Report - The market has entered the inventory accumulation period around the Spring Festival. With weak demand and high inventory, the spot price is likely to fall rather than rise, driving the futures market downward. Considering the rapid accumulation of pre - festival inventory and the significant decline in spot prices, the near - month contracts may still need to squeeze out the premium. Maintain a short - selling strategy. The far - end market will re - trade the logic of production capacity reduction after the spot price turns, but the implementation path under low cost and high premium remains uncertain, and attention should be paid to the pressure after the price rises [11][12] Summary by Relevant Catalogs 1. Monthly Assessment and Strategy Recommendation - **Spot Market**: From January to now, domestic egg prices first soared and then fell due to sentiment. At the beginning of the month, industry players were bullish, with fast market sales and low upstream and downstream inventories. By the end of the month, the price increase accelerated and exceeded expectations. However, from the end of the month to now, due to risk - control sentiment, demand decreased, inventory increased significantly, and egg prices dropped sharply from the high. In January, the slaughter of laying hens slowed down, the average age of hens increased, and the prices of chicks and young chickens rose. In February, market demand will gradually weaken, and egg prices will generally decline. After the Spring Festival, egg prices may fall below the cost [11] - **Restocking and Culling**: In January, 86.44 million hens were restocked, a year - on - year decrease of 3.6% and a month - on - month increase of 9.2%. The restocking sentiment is not as strong as last year, but it has improved month - on - month due to the increase in spot prices and the optimistic market outlook. The prices of chicks have also risen from the low. Due to the previous low egg prices and continuous breeding losses, the slaughter of hens increased, and the average age of hens decreased. During the pre - Spring Festival stocking period, the sales of eggs were fast, and the egg price increase exceeded expectations. The breeding sector returned to profitability, which led to a slowdown in hen slaughter, and the average age of hens has now stopped falling and increased to 495 days [11] - **Inventory and Trend**: As of the end of January, the inventory of laying hens was 1.342 billion, lower than the previous value but higher than expected. The main reason is that the decrease in previous restocking led to a decline in newly - laid hens, but the slowdown in hen slaughter since January slowed down the decline in inventory, and the absolute value is still high. Based on the previous restocking data and normal hen slaughter, it is expected that the inventory will gradually peak and decline in the future, dropping to 1.289 billion by June this year, a decline of 3.9%. Although the relative supply will gradually decrease, the absolute supply is still relatively high [11] - **Demand Side**: As egg prices have risen to a phased high, traders are more cautious, and the market purchase volume may decrease. As the Spring Festival approaches, migrant workers are returning home, and the export of eggs is gradually turning into domestic sales. In the short term, attention should be paid to the digestion of domestic sales in the production areas [11] - **Trading Strategy**: Hold short positions in far - month contracts at high prices, short - sell near - month contracts such as 03 on rebounds, and pay attention to the possible logic switch after the Spring Festival. The profit - loss ratio is 2:1, and the recommended period is 1.5 months. The core driving logic includes inventory, spot price, and seasonality [13] 2. Spot and Futures Market - **Spot Price Trend**: From January to now, domestic egg prices first rose and then fell. In February, market demand will gradually weaken, and egg prices will generally decline. After the Spring Festival, egg prices may fall below the cost. For example, the price of large - sized eggs in Heishan increased by 0.3 yuan to 3.1 yuan per catty in January, with a monthly high of 3.8 yuan per catty [20] - **Basis and Spread**: The spot price has dropped significantly, and the basis has returned to normal. As the spot price turns downward, the monthly spread is more suitable for reverse arbitrage [23] - **Slaughtered Hen Price**: As egg prices rebounded from the low and breeding became profitable, farmers were reluctant to sell, and the price of slaughtered hens and the average age of hens increased [26] - **Chick and Young Chicken Price**: Due to the increase in restocking sentiment, the prices of chicks and young chickens have risen from the low [11] 3. Supply Side - **Egg - Laying Hen Restocking**: In January, 86.44 million hens were restocked, a year - on - year decrease of 3.6% and a month - on - month increase of 9.2%. The restocking sentiment has improved month - on - month due to the increase in spot prices and the optimistic market outlook [33] - **Slaughtered Hen Sales**: The previous low egg prices and breeding losses led to continuous large - scale slaughter of hens and a decline in the average age of hens. During the pre - Spring Festival stocking period, the egg price increase exceeded expectations, and the breeding sector returned to profitability, which led to a slowdown in hen slaughter, and the average age of hens has now stopped falling and increased to 495 days [36] - **Inventory and Trend**: As of the end of January, the inventory of laying hens was 1.342 billion, lower than the previous value but higher than expected. It is expected that the inventory will gradually decline to 1.289 billion by June this year, a decline of 3.9%, but the absolute supply is still relatively high [38][41] 4. Demand Side - As egg prices have risen to a phased high, traders are more cautious, and the market purchase volume may decrease. As the Spring Festival approaches, migrant workers are returning home, and the export of eggs is gradually turning into domestic sales. In the short term, attention should be paid to the digestion of domestic sales in the production areas [46] 5. Cost and Profit - The cost is lower year - on - year and has increased month - on - month. After the increase in spot prices, the breeding profitability has significantly recovered to the normal seasonal level [51] 6. Inventory Side - The pre - festival inventory has increased significantly, indicating that the supply scale is still large [56]

Group 1: Report Industry Investment Rating - No relevant content available Group 2: Core Viewpoints of the Report - After the holiday, there is a resonance of multiple negative factors such as large supply, low consumption, and wet and cold weather constraints. The current market sentiment is pessimistic, and egg prices have returned to the lows of the plum - rain season, showing the weakest performance in the same period in many years. The previous futures market had expectations for post - holiday restocking, but after the expectations were disappointed, it continued to trade and squeeze the premium. Although the culling of laying hens has accelerated, it is difficult to match the scale of new supply in the short term. Considering that the negative feedback of the spot market is still continuing, it is advisable to maintain a bearish view on the near - term contracts. In the medium term, after the pessimistic sentiment eases, there is a possibility of a rebound correction driven by restocking. In the long term, the supply pressure is large, and it is advisable to wait for a rebound and then short sell [11] Group 3: Summary by Directory 3.1 Monthly Assessment and Strategy Recommendation - **Spot market**: In September, domestic egg prices first rose and then fell, in line with the seasonal pattern. At the beginning of the month, stimulated by consumption themes such as the start of school, the market sales improved. After the middle of the month, the market risk - control sentiment increased, and the supply pressure remained unchanged. During the National Day, the restocking consumption was lower than expected, inventory accumulated, and prices continued to fall, with the decline significantly higher than expected. The price of large - sized eggs in Heishan increased by 0.1 yuan to 2.8 yuan per catty, with a monthly high of 3.6 yuan per catty; the price in Guantao decreased by 0.29 yuan to 2.49 yuan per catty, with a monthly high of 3.6 yuan per catty; the price in Huilongguan in the sales area decreased by 0.38 yuan to 3.05 yuan per catty; the price in Dongguan increased by 0.13 yuan to 2.94 yuan per catty. It is expected that egg prices will be weakly sorted at a low level in the first half of October and may have a slight rebound space in the second half due to restocking [11] - **Restocking and culling**: Affected by the continuous low egg prices and breeding losses, the national restocking volume in September continued to decline to 78.4 million, a month - on - month decrease of 1.5% and a year - on - year decrease of 14.1%. Since September, egg prices have been weaker than normal, and due to seasonal factors, the culling of old hens has increased significantly, the price of culled hens has fallen to a multi - year low, and the average age of hens has further decreased to 499 days, but it is still far from excessive culling [11] - **Inventory and trend**: As of the end of September, the inventory of laying hens was 1.368 billion, slightly lower than previously expected, a month - on - month increase of 30 million compared with August and a year - on - year increase of 6% compared with 1.288 billion last year. Based on previous restocking calculations, considering normal culling, the inventory will still have room to increase in the future, with a peak expected to reach 1.373 billion in November this year, a slight increase from the current level. Although there will be a decline later, the inventory will still be high, and the supply side will still face an oversupply situation in the long term [11] - **Demand side**: The restocking for the Double Festival is coming to an end, and post - holiday consumption tends to be flat. However, as the temperature drops, the storage conditions for eggs improve. Before the Spring Festival, the consumption side may experience a process of first accumulating inventory and then reducing inventory [11] - **Trading strategy**: For unilateral trading, it is recommended to wait and see and pay attention to the possibility of a low - level rebound in November and December; for arbitrage, there is currently no recommendation [13] 3.2 Spot - Futures Market - **Spot price trend**: In September, domestic egg prices first rose and then fell, in line with the seasonal pattern. Specific prices in different regions have different changes. It is expected that egg prices will be weakly sorted at a low level in the first half of October and may have a slight rebound space in the second half due to restocking [20] - **Basis and spread**: After the holiday, as the spot price fell, the futures basis returned to a relatively low level, driving the spread between contracts to fall [23] - **Culled hen price**: Egg prices are not strong during the peak season. Currently, the number of old hens being culled has increased, and the price of culled hens has significantly declined. Attention should be paid to its sustainability [26] 3.3 Supply Side - **Laying hen restocking**: Affected by the continuous low egg prices and breeding losses, the national restocking volume in September continued to decline to 78.4 million, a month - on - month decrease of 1.5% and a year - on - year decrease of 14.1% [33] - **Culled hen culling**: Since September, egg prices have been weaker than normal, and due to seasonal factors, the culling of old hens has increased significantly, the price of culled hens has fallen to a multi - year low, and the average age of hens has further decreased to 499 days, but it is still far from excessive culling [36] - **Inventory and trend**: As of the end of September, the inventory of laying hens was 1.368 billion, slightly lower than previously expected, a month - on - month increase of 30 million compared with August and a year - on - year increase of 6% compared with 1.288 billion last year. Based on previous restocking calculations, considering normal culling, the inventory will still have room to increase in the future, with a peak expected to reach 1.373 billion in November this year, a slight increase from the current level. Although there will be a decline later, the inventory will still be high, and the supply side will still face an oversupply situation in the long term [38][41] 3.4 Demand Side - The restocking for the Double Festival is coming to an end, and post - holiday consumption tends to be flat. However, as the temperature drops, the storage conditions for eggs improve. Before the Spring Festival, the consumption side may experience a process of first accumulating inventory and then reducing inventory [46] 3.5 Cost and Profit - The cost is lower year - on - year and has declined month - on - month. In terms of profitability, it is at a relatively low seasonal level [51] 3.6 Inventory Side - The inventory is basically at a normal or slightly higher seasonal level [56]