Report Title - "High Temperature Hits, Market Enters Seasonal Peak Season - Egg Weekly Report 2025-07-14" [1] Report Investment Rating - Not provided Core Viewpoints - The current contradiction is the co - existence of high supply and seasonal weather factors, leading to low spot prices. However, there will be a conversion point between the cycle and seasonal strength and weakness. The futures and spot markets are expected to have a phased rebound, and it is recommended to buy on dips and pay attention to reverse arbitrage opportunities [3] Summary by Directory Futures Market - Last week, the egg futures showed a neutral trend, with near - term contracts being weaker and far - term contracts being stronger. The near - term contracts were supported by delivery, maintaining a premium, while the far - term contracts oscillated. The spot was still constrained by weather and short - term supply - demand pressure, and the futures were in a phased bottom - building process, waiting for a reversal [6] Spot Market - Last week, the egg spot was generally stable. The production areas drove the sales areas to lower prices. The inventory in the production areas was high, and the market was actively selling goods and lowering prices. The sales areas were generally stable. Currently, weather conditions were suppressing spot prices, but the seasonal peak season was approaching, with tourism and demand support on the way, and the energy efficiency on the supply side would further decrease [14] Supply - **Newly - added capacity**: From June to August 2025, the newly - opened production corresponded to the replenishment volume from February to April 2025, which remained at a high level, higher than the historical average [17] - **Eliminated capacity**: From June to August 2025, the normal eliminated capacity corresponded to the replenishment volume from October 2023 to January 2024, and the available elimination volume was relatively neutral [17] - **Laying hen inventory**: The inventory of laying hens remained at a high level. The newly - added capacity increased steadily, the new replenishment slowed down, and the available elimination volume decreased slightly this month. The data showed that the backward production capacity had started the active elimination phase, but relatively slowly, and the overall supply pressure still existed [17] - **Eliminated chickens**: The backward production capacity began to be removed but had not entered the acceleration phase. The price of eliminated chickens was 4.51 yuan/jin, down 0.1 yuan/jin, seemingly entering a bottom - rebound period. The elimination volume continued to rise and was approaching the peak, and the "shutdown" might slow down. The average elimination age was 502 days, down 2 days, showing an obvious downward trend [21] Demand - The demand side did not change significantly. With students across the country on vacation, the demand slowed down in the short term. New demand release needed time, waiting for support from summer tourism and mid - to - long - term Mid - Autumn Festival stocking [3] Cost and Profit - **Cost**: The corn price remained at a high level, and the soybean meal spot price declined steadily. The overall cost fluctuated slightly downward. Currently, the feed cost was about 2.5 yuan/jin, and the comprehensive breeding cost was about 2.8 yuan/jin [3] - **Profit**: The breeding profit fell below the feed cost, and the entire industry entered a deep loss period, operating at a low level, waiting for a seasonal bottom - rebound. The negative feedback of production capacity caused by profit losses was gradually taking effect, and attention should be paid to the elimination of backward production capacity [3][30] Market Sentiment and Spread - **Funds**: The funds were at a high level, and the market competition intensified. The bears believed that due to high production capacity and seasonal suppression, there was still room for decline, while the bulls thought the valuation was low and the season was about to turn from weak to strong, presenting value for long - positions [33] - **Basis**: The basis was negative, and the overall futures price was at a premium, with positive expectations. Currently, the basis was at a low level, waiting for the strengthening trend brought by the active peak season [35] - **Spread**: The decline in spot prices suppressed near - term contracts, and short - term reverse arbitrage was the main strategy [38] Related Product Impact - **Vegetables**: Vegetable prices were about to enter a seasonal strengthening phase, providing some support for egg prices [26] - **Pork**: The pork price continued to weaken, and its substitution effect on eggs was not obvious [26] - **Other meats**: The prices of other meats showed a short - term strengthening trend [26]

Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The egg market shows a clear contradiction of oversupply and low valuation in the current stage. After the seasonal stocking, the weather factor will continue to suppress the market. It is recommended to short after the rebound and continue the JD59 positive spread strategy [3]. 3. Summary by Related Catalogs 3.1 Periodic and Spot Market Review - **Egg Futures**: Last week, the futures market showed concerns about the short - term spot price increase. The futures market was stagnant and needed further guidance from the spot market. Although the spot market may still have room to rise, the futures market has started to reflect the post - holiday spot price expectations. It will still take time for the market to break away from the bottom range [6]. - **Egg Spot**: Last week, the spot price was stable with a slight upward trend. Supported by downstream stocking, the spot price rebounded from the bottom and fluctuated in the range of 3.2 - 3.5 yuan per catty. However, after the May Day stocking, the downstream market will return to weakness, and the weather will become the main factor suppressing the spot price [6]. 3.2 Supply Side - **New - added Capacity**: From March to June 2025, the newly - opened production corresponds to the replenishment volume from October 2024 to January 2025, which remains at a high level and is higher than the historical average [10]. - **Eliminated Capacity**: From March to June 2025, the normal eliminated capacity corresponds to the replenishment volume from October 2023 to January 2024, and the available elimination volume is relatively neutral [10]. - **Laying Hen Inventory**: The inventory remains at a high level. The growth rate of normal new - added capacity is relatively stable, and the elimination volume is high, which may lead to a slowdown in phased supply [10]. 3.3 Elimination End - The price of eliminated chickens fluctuates at a high level, the elimination volume slows down significantly, the average elimination age is about 530 days, and the elimination enthusiasm is increasing [13]. 3.4 Market Factors - **Seasonality**: The seasonal strength - weakness conversion occurs, and the restocking demand is still the main support for the current market [15]. - **Production Area**: The inventory in the production area is not high, and purchases are made on demand. The future weather in the south is not conducive to storage, and quality issues will affect egg prices [15]. - **Consumption End**: After holiday stocking, the inventory has been transferred to the downstream [15]. - **Substitute Products**: Vegetable prices are weak, and the supply has recovered, so the support for egg prices has weakened; pork prices continue to decline, and the substitution effect on eggs is not obvious; other meat prices have strengthened in the short term [17]. 3.5 Cost and Profit - **Raw Material End**: Corn and soybean meal prices have rebounded from the low level. Corn is supported by policy - based purchases, and soybean meal remains stable with a slight upward trend due to short - term spot shortages [22]. - **Cost End**: The cost continues to rise. Currently, the feed cost is about 2.6 yuan per catty, and the comprehensive breeding cost is about 2.9 yuan per catty [22]. - **Breeding Profit**: The breeding profit has rebounded, but it has not yet emerged from the seasonal low [22]. 3.6 Capital and Market Indicators - **Capital Flow**: After the rebound this week, funds left the market and then re - entered. The short - selling main funds exerted force again [25]. - **Basis**: The basis has fallen from a high level. The spot price has dropped significantly after the holiday, but the basis has stabilized and strengthened later, which is expected to provide some support for the market [27]. - **Spread**: With the rebound of the spot price, the near - term contracts are supported, and the spread has strengthened. In the future, the positive spread strategy will be the main approach [30].