Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core Views - Supply: USDA estimates the ending inventory of US soybeans in the 25/26 season to be 300 million bushels, and the expected yield of 53.5 bushels per acre may be revised down. Exports depend on Sino-US policies. As of the week of October 18, 2025, the planting rate of Brazilian soybeans in the 2025/26 season was 21.7%, up from 11.1% last week and 17.6% in the same period last year, with a five-year average of 27.7%. Recently, there has been dry weather in Brazilian soybean-producing areas, but its persistence is not strong, and the expected impact is limited. Domestic soybean meal is expected to start destocking in November, but the supply in the fourth quarter is still expected to be loose. If China cannot purchase US soybeans, the supply of soybean meal in the first quarter of next year still needs to be supplemented, and the source of supplementation is uncertain [7][8]. - Demand: Livestock and poultry are expected to maintain high inventories in the short term, and the reduction of production capacity is not obvious, which supports the demand for soybean meal. However, the current breeding profit is in a loss state, and national policies tend to control the inventory and weight of pigs, which may affect the supply in the far - month. The downstream trading volume of soybean meal is normal, and the pick - up is good [8]. - Inventory: Domestic soybean and soybean meal inventories are at a high level compared to the same period in history, and the number of days of soybean meal inventory in feed enterprises has dropped to a low level [8]. - Overall: Before the Sino - US meeting, due to the hedging demand for policy uncertainty, short - covering led to a rebound, but the overall oscillating trend has not changed. Attention should be paid to the progress of Sino - US trade negotiations and changes in South American weather [8]. 3. Summary by Related Content 3.1 Basis and Spread Data - **Basis**: On October 24, 2025, the basis of the soybean meal main contract in Dalian was 87, up 25; in Tianjin, it was 67, up 25; in Rizhao, it was 87, up 45. The basis of 43% soybean meal spot in Zhangjiagang was 27, up 25; in Dongguan, it increased by 25; in Zhanjiang, it was 47, up 25; in Fangcheng, it was 27, up 15. The basis of rapeseed meal spot in Guangdong was 64. The M1 - 5 spread was 165, down 3, and the M1 - RM1 spread was 475, up 26 [6]. - **Spread**: The spot spread of soybean meal - rapeseed meal in Guangdong was 300, and the spread of the main contract was 608, up 9. The RM1 - 5 spread was 1.500, up 25, down 2 [7]. 3.2 Exchange Rate, Crushing Margin and Premium Data - The US dollar to RMB exchange rate was 7.0847, unchanged. The crushing margin of imported soybeans was - 231.00 yuan/ton [7]. - The CNF premium of Brazilian soybeans in different months in 2025 showed different trends, and the premium of Brazilian soybeans in some months was in the range of 210 - 420 cents per bushel [7]. 3.3 Inventory and Supply - Demand Data - **Inventory**: Domestic soybean and soybean meal inventories are at a high level compared to the same period in history, and the number of days of soybean meal inventory in feed enterprises has dropped to a low level [8]. - **Supply - demand**: In the supply side, the US soybean ending inventory and yield expectations may change, and the Brazilian soybean planting rate has increased, but the weather impact is limited. In the demand side, short - term livestock and poultry inventories are high, but breeding profits are in a loss state. The downstream trading volume of soybean meal is normal, and the pick - up is good [7][8].

Summary of Dabeinong (002385.SZ) Earnings Review Company Overview - **Company**: Dabeinong (002385.SZ) - **Industry**: Agriculture in China - **Market Cap**: Rmb17.5 billion / $2.5 billion - **Enterprise Value**: Rmb25.8 billion / $3.6 billion - **Current Price**: Rmb4.23 - **12-Month Price Target**: Rmb8.00 - **Upside Potential**: 89.1% [1][2][6] Key Financial Highlights - **1H25A Net Profit**: Rmb235 million, EPS of Rmb0.055/share, compared to a loss of Rmb0.036/share in 1H24A [1] - **Recurring Net Profit**: Rmb196 million, versus a loss of Rmb244 million in 1H24A [1] - **Revenue Growth**: 4% YoY to Rmb13,559 million in 1H25A [40] - **Gross Profit**: Increased by 12% YoY to Rmb1,915 million [40] - **No Final Dividend Declared**: Consistent with the previous year [1] Earnings Estimates Revisions - **2025E Recurring Earnings**: Revised down by 25% due to lower hog pricing assumptions [2] - **2026E Recurring Earnings**: Revised down by 4% [2] - **2027E Recurring Earnings**: Revised down by 9% [2] Segment Performance - **Feed Operations**: Contributed 56% of total gross profit; gross profit per ton was Rmb417, down 10% YoY [23] - **Hog Farming**: Contributed 29% of total gross profit; total unit cost of market hog decreased by 16% YoY [26] - **Traditional Seeds**: Contributed 9% of total gross profit; driven by higher sales volume and unit gross profit [27] - **Biotech Seeds**: Expected to generate Rmb116 million in revenue in 2025E, with a potential increase to Rmb532 million in 2026E [21] Market Dynamics - **Hog Pricing Outlook**: Expected to improve to Rmb16.5/kg in 2026E, up from Rmb14.8/kg in 1H25A [20] - **Biotech Seed Penetration**: Anticipated to reach 7% in the 2024/25 planting season, lower than previous estimates [21] - **Traditional Seed Market**: Potential market gains in Southwestern regions due to product promotion [22] Cash Flow and Balance Sheet - **Operating Cash Flow**: Turned positive in 1H25A, compared to negative Rmb190 million a year ago [34] - **Free Cash Flow**: Negative Rmb363 million in 1H25A, an improvement from negative Rmb593 million in 1H24A [34] - **Net Debt**: Rmb8.14 billion as of end of 1H25A, with net gearing at 93% [35][36] Valuation and Risks - **Valuation Methodology**: Based on average near-term and long-term valuations, with a target price implying a P/E of 34x for 2025E [37] - **Key Risks**: Include uncertainty in hog prices, lower-than-expected feed consumption demand, and slower government plans for GM seed commercialization [38] Conclusion - **Investment Recommendation**: Maintain Buy rating on Dabeinong with a target price of Rmb8.00, reflecting strong potential upside based on market positioning and growth in biotech seeds [2][37]

Market Overview - The three major indices opened mixed, with the Shanghai Composite Index down 0.01%, the Shenzhen Component Index down 0.03%, and the ChiNext Index up 0.17% [1] - The Shanghai Composite Index is at 3380.21, with a decline of 0.01% and 741 gainers against 1107 losers [2] - The Shenzhen Component Index is at 10246.52, down 0.03%, with 745 gainers and 1668 losers [2] - The ChiNext Index is at 2052.00, up 0.17%, with 357 gainers and 855 losers [2] External Market - The US stock market has paused its rebound, with the S&P 500 down 0.39% to 5940.46, the Nasdaq down 0.38% to 19142.71, and the Dow Jones down 0.27% to 42677.24 [3] - The Nasdaq China Golden Dragon Index fell 0.65%, with mixed performances from major Chinese tech stocks [3] Institutional Insights - CITIC Securities highlights rapid progress in the AI industry chain, expecting continued upward trends due to ongoing iterations of AI models and technologies, benefiting software companies with data, customers, and scenarios [4] - Huatai Securities continues to recommend the pet sector, noting strong Q2 performance data and upcoming catalysts such as events and promotions [5] - Guotai Junan Securities reports high growth in feed production, with a 4.2% month-on-month increase and a 9.0% year-on-year increase in April 2025, driven by recovery in livestock and aquaculture [6] - Huatai Securities also recommends real estate stocks with a "three good" logic, focusing on companies with good credit, good cities, and good products, particularly in core cities [7]