1. Report Industry Investment Rating - Not provided in the report 2. Core Viewpoints of the Report - In the short - term, the pig futures market has no signal of stabilization and is likely to continue weak oscillation at a low level. In the medium - to - long - term, due to high feed costs and continuous deep losses in the industry, inefficient production capacity will be cleared out faster. With the arrival of the seasonal consumption peak in autumn and winter, the supply - demand pattern is expected to gradually improve, and the pig market may recover in the fourth quarter [7][76][77] 3. Summary by Directory 3.1. Price Review - **Futures price**: Since March, the pig futures market has been under heavy pressure. The main contract price has dropped sharply, hitting new lows since listing. As of March 31, the LH2605 contract was reported at 9,770 yuan/ton, with a monthly decline of 14.93% [5][13] - **Spot price**: After the Spring Festival in 2026, the national pig price continued to decline. By March 31, the national average pig出栏 price dropped to 9.43 yuan/kg, a month - on - month decrease of 1.36 yuan/kg. The prices of piglets and culled sows also declined, and the industry's replenishment willingness was weak [6][16][19] - **Price difference**: The basis of live pigs turned negative, and the standard - fat price difference continued to narrow. As of March 31, the live pig basis was - 250 yuan/ton, and the standard - fat price difference was - 0.59 yuan/kg [26][30] 3.2. Fundamental Analysis 3.2.1. Supply Side - **Sow inventory**: As of the end of the fourth quarter of 2025, the national sow inventory was 39.61 million, a month - on - month decrease of 1.83%. In March, the policy adjusted the sow inventory target to 36.5 million, a reduction of 3.11 million from the end of 2025 [34] - **Pig inventory**: As of the end of the fourth quarter of 2025, the national pig inventory was 429.67 million, a month - on - month decrease of 1.63%. It is expected that the pig inventory in the first quarter will decline month - on - month [39] - **Pig出栏**: In February, the overall出栏 of the breeding end did not meet expectations. In March, the supply pressure increased due to the concentrated release of pig sources [47] - **Average出栏 weight**: In March, the average出栏 weight of commercial pigs rebounded rapidly. As of the week of March 27, it reached 123.32 kg, a month - on - month increase of 0.29% [51] - **Production efficiency**: The production efficiency of the pig breeding industry has been continuously improving, with the average PSY reaching about 26 and the fattening survival rate remaining above 90%, which offsets the marginal contraction of production capacity caused by the reduction of sow inventory [55] 3.2.2. Demand Side - **Slaughter enterprise operating rate**: Affected by the continuous decline of pig prices and concentrated出栏, the operating rate of slaughter enterprises rebounded to 33.95% in March, higher than the same period in 2024 and 2025 [60] - **Frozen product storage rate and fresh sales rate**: After the Spring Festival, the fresh sales rate of slaughter enterprises decreased to 78.55%, and the frozen product storage rate increased to 21.52% [65] 3.2.3. Cost - profit Situation - **Breeding profit**: Since March, the breeding profit of self - breeding and self - fattening and purchasing piglets for fattening has been in deep losses. As of March 30, the loss per head was 330.82 yuan and 221.06 yuan respectively [68] - **Pig - grain ratio**: In March, the pig - grain ratio dropped below 5:1, reaching a new low of 4.14, forcing the industry to optimize the production capacity structure [72] 3.2.4. Reserve Purchase Situation - The market's expectation of reserve purchase has increased, but the probability of large - scale national reserve purchase in the short term is low. Some provinces have launched regional reserve purchases, but the impact on the overall supply - demand pattern is limited [75] 3.3. Market Outlook and Operation Strategies - **Market outlook**: In the short term, the market will continue to oscillate weakly at a low level. In the medium - to - long - term, the market is expected to improve in the fourth quarter [76][77] - **Operation strategies**: In the short term, it is recommended to wait and see and pay attention to the pace of production capacity reduction. In the medium - to - long - term, opportunities for cyclical reversal can be selectively deployed. There are no strategies for arbitrage and options [8][78]

Investment Rating - The report maintains a positive outlook on the agricultural sector [12] Core Insights - The price of weaned piglets has accelerated its decline, with prices for 7 kg piglets falling below 300 yuan per head, while the pig price continues to fluctuate at a low level, leading to industry losses that have persisted for about six months. Market-driven capacity reduction is expected to accelerate [2][6] - Geopolitical issues are ongoing, and rising crude oil prices are pushing basic agricultural product prices upward, which may further increase breeding costs. The combination of falling pig prices and rising costs is expected to exacerbate industry losses and accelerate cash flow depletion for breeding enterprises [2][6] - During the downward cycle, the competitiveness of breeding costs will become the core competitive advantage for enterprises. This cycle may lead to a continuous optimization of the industry competitive landscape, with companies that have cost advantages and cash flow expected to enjoy longer profit cycles. The report is optimistic about the pig breeding sector and recommends focusing on it [2][6] Summary by Sections Pig Breeding - As of March 20, 2026, the average price of pigs nationwide is 9.99 yuan/kg, down 33% year-on-year and 3% month-on-month. The price of 15 kg piglets is 385 yuan/head, down 39% year-on-year and 9% month-on-month; the price of 7 kg piglets is 294 yuan/head, down 43% year-on-year and 10% month-on-month [19] - The industry has faced losses for six months, with cash flow pressure becoming increasingly prominent. Given the current relatively loose supply of pigs, prices are likely to remain at the bottom during the traditional off-season from March to April [7][19] - The report highlights the core competitiveness of low-cost breeding enterprises and continues to recommend companies such as Wens Foodstuffs, Dekang Agriculture, and Shennong Group [7] Beef Breeding - Since 2026, beef prices have risen significantly, with the price of fattened bulls at 26.02 yuan/kg, up 8% year-on-year, and calf prices at 34.8 yuan/kg, up 38% year-on-year. The price of breeding cows is 9700 yuan/head, up 10% year-on-year [8][42] - The current cycle of beef breeding has seen prolonged losses, leading to a significant reduction in domestic breeding cow capacity. The report anticipates that the current cycle of beef breeding may last over two years due to tightening global beef supply [8][42] Other Agricultural Products - As of March 20, 2026, corn prices are 2333 yuan/ton, up 6% year-on-year; soybean meal prices are 3372 yuan/ton, up 1% year-on-year; and wheat prices are 2600 yuan/ton, up 7% year-on-year [62][64] - Geopolitical issues may continue to boost agricultural product prices, with rising oil prices increasing planting costs in major agricultural regions [9]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部分內容而 產生或因依賴該等內容而引致的任何損失承擔任何責任。 MUYUAN FOODS CO., LTD. 牧 原 食 品 股 份 有 限 公 司 （於中華人民共和國註冊成立的股份有限公司） （股份代號: 2714） 海外監管公告 本公告乃根據香港聯合交易所有限公司證券上市規則第13.10B條刊發。 根據中華人民共和國的有關法例規定，牧原食品股份有限公司（「本公司」）在巨 潮資訊網（www.cninfo.com.cn）刊發了以下公告。茲載列如下，僅供參閱。 承董事會命 牧原食品股份有限公司 董事長兼總裁 秦英林先生 中國，河南省南陽市，2026年3月27日 於本公告日期，本公司董事會成員包括：(i)執行董事秦英林先生、曹治年先生及楊瑞華 女士；(ii)非執行董事錢瑛女士及蘇黨林先生；及(iii)獨立非執行董事周明笙先生、閻磊 先生及馮根福先生。 牧原食品股份有限公司 2025 年年度报告摘要 | 证券代码：002714 | 证券简称：牧原股份 | 公告编号：2026 ...

Report Investment Rating - Not mentioned in the report Core Viewpoints - The current de - stocking of the pig industry is still falling short of expectations, and the probability of an L - shaped bottom is increasing. The price bottom has not been reached, and the spot price in April is expected to continue to decline. The cycle bottom may shift from a W - shaped to an L - shaped, and the 5 - month contract premium is expanding [3][4] Summary by Directory 1. This Week's Market Review (3.23 - 3.29) Spot Market - The price of 20KG piglets in Henan was 27.25 yuan/kg (unchanged from last week), the price of live pigs in Henan was 9.43 yuan/kg (down from 9.93 yuan/kg last week), and the price of 50KG binary sows nationwide was 1,536 yuan/head (unchanged from last week). Group enterprises increased their live pig sales, and there was passive pressure on the market. Slaughter volume continued to rise above the seasonal level, and the volume of passive cold storage increased. Secondary fattening re - entered the market in the second half of the week. The average national slaughter weight was 125.89KG, a 0.27% increase from last week [1] Futures Market - The price of the LH2605 contract of live pig futures was weak. The highest price was 10,180 yuan/ton, the lowest was 9,815 yuan/ton, and the closing price was 9,965 yuan/ton (down from 10,220 yuan/ton last week). The basis of the main contract was - 535 yuan/ton (down from - 290 yuan/ton last week) [2] 2. Next Week's Market Outlook (3.30 - 4.5) Spot Market - The spot price of live pigs will be weak. In March, enterprises' willingness to actively sell and de - stock increased, and the sales progress was slightly faster. The slaughter volume was at a high level in the same period of history, but the weight of the pigs did not decrease, and passive inventory accumulation was still occurring, indicating that the inventory volume far exceeded expectations and the price bottom had not been reached. From the supply perspective, the supply of standard pigs will continue to increase until April 2026. After the Spring Festival, passive inventory accumulation continued, and the weight was at the highest level in the same period in recent years. The dual pressure of the production capacity cycle and the inventory cycle will be realized in April - May, and the supply pressure will be at a marginal high. From the demand perspective, the market had strong expectations for the pre - Spring Festival peak season, driving speculative demand in January, but the negative feedback of downstream losses during the peak season was evident, resulting in the increase in the peak season being less than expected. After the post - festival spot price decline, the slaughter volume has remained at a high level above the seasonal level, and speculative demand such as secondary fattening and cold storage has increased, further over - drafting speculative demand. It is expected that the spot price in April may continue to decline [3] Futures Market - The price of the LH2605 contract closed at 9,965 yuan/ton on March 27. The volume of cold storage in March continued to expand, the slaughter volume increased significantly year - on - year, and enterprises increased their sales, but the weight did not decrease. It is expected that the enterprise sales plan in April will continue to increase, indicating that the inventory volume exceeds expectations, the de - stocking process is falling short of expectations, and the price of piglets has dropped significantly, corresponding to a further decline in the cost of slaughter in September. The bottom of this cycle may gradually shift from a W - shaped to an L - shaped, and the premium of the May contract is expanding. Considering the expected price decline in April - May, the driving force for the premium is strengthening. Pay attention to setting stop - loss and take - profit levels. The short - term support level for the LH2605 contract is 9,000 yuan/ton, and the pressure level is 10,500 yuan/ton [4] 3. Other Data - The basis this week was - 535 yuan/ton, and the LH2605 - LH2607 monthly spread was - 1,215 yuan/ton [9] - The average weight this week was 125.89KG (up from 125.55KG last week). In January, the pork production was 5.36 million tons, a 1.7% month - on - month decrease; in February, the pork import was 52,100 tons, a 22.77% month - on - month decrease [12]

Investment Rating - The industry investment rating is "Positive" (maintained) [1] Core Insights - The report highlights that the current supply pressure in the live pig market is accelerating, with prices continuing to decline, reaching a new low of 9.37 CNY/kg as of March 27, 2026, down 0.50 CNY/kg from the previous week [3][14] - The report indicates that the demand side remains weak, with the national frozen product inventory rate rising to 19.57%, reflecting a shift from destocking to restocking [4][18] - The profitability of piglet farming has entered a loss zone, with the average profit per piglet sold dropping to -29 CNY, indicating a negative trend in market expectations for future restocking [5][26] Summary by Sections Weekly Observation - The report notes that the low pig prices are leading to increased slaughtering activity, with daily slaughter volumes up by 2.25% compared to the previous week, indicating strong willingness from farmers to sell [3][14] - The average weight of pigs being sold shows significant differentiation, with smallholders reporting an average weight of 145.68 kg, which is 9.04 kg higher year-on-year [3][14] Market Performance - The agricultural sector underperformed the broader market by 1.85 percentage points, with the agricultural index declining by 2.94% during the week [7][34] - Notable stock performances include West King Food (+13.88%), Huadong Holdings (+13.37%), and Yuehai Feed (+8.62%) leading the gains [7][34] Price Tracking - As of March 27, 2026, the national average price for live pigs was 9.39 CNY/kg, down 0.60 CNY/kg from the previous week, while piglet prices fell to 21.60 CNY/kg, a decrease of 1.52 CNY/kg [8][46] - The report also notes that the average profit for self-bred pigs was -344.24 CNY per head, reflecting a significant decline in profitability [8][47] Key News - A joint warning was issued by the Ministry of Agriculture and Rural Affairs and the China Meteorological Administration regarding the risk of farmland flooding due to expected heavy rainfall [6][42] - The report includes data on national feed production, which reached 5.185 million tons in January-February 2026, marking a year-on-year increase of 3.4% [6][42]

Financial Performance - In 2025, the company achieved a revenue of CNY 144.145 billion, a year-on-year increase of 4.49% [5] - The net profit attributable to shareholders was CNY 15.487 billion, showing a decline due to falling pig market prices [5] - The net cash flow from operating activities was CNY 30.056 billion, indicating stable cash flow [5] Debt Management - As of the end of 2025, the debt-to-asset ratio was 54.15%, a decrease of 4.53 percentage points from the beginning of the year [6] - The total debt decreased by CNY 17.1 billion, exceeding the annual debt reduction target [6] Production and Sales - In 2025, the company sold 77.981 million pigs, with a focus on high-quality and stable development [6] - The average cost of pig farming in 2025 was approximately CNY 12/kg, down by CNY 2/kg year-on-year [6][10] - The company plans to sell between 75 million and 81 million pigs in 2026 [7] Slaughtering and Meat Processing - In 2025, the company slaughtered 28.663 million pigs, achieving a 98.8% capacity utilization rate [7] - The meat processing segment achieved its first annual profit since establishment, marking a new development phase [7] Shareholder Returns - The profit distribution plan for 2025 includes a cash dividend of CNY 4.27 per 10 shares, totaling CNY 2.435 billion [8] - The total cash dividend for 2025 is expected to be CNY 7.438 billion, accounting for 48.0% of the net profit [9] Cost Reduction Strategies - The company aims to reduce the average cost of pig farming to below CNY 11.5/kg in 2026 [10] - Strategies include enhancing disease prevention, optimizing employee incentives, increasing investment in breeding, and applying advanced technologies [11] Breeding Direction - The breeding strategy focuses on maximizing comprehensive profit contributions from breeding performance, production indicators, and meat quality [12] - The evaluation system includes metrics such as PSY, feed conversion ratio, daily weight gain, and carcass value [12] Overseas Expansion - The company aims to establish breeding capacity in Vietnam and develop localized teams, with 60% of funds raised in Hong Kong allocated for overseas expansion [14] - The focus will be on replicating successful domestic technologies in international markets [14] Capital Expenditure and Debt Reduction - The capital expenditure for the current year is estimated at CNY 10 billion, with increased investment in the meat processing segment [15] - The company will adopt a cautious approach to debt reduction, prioritizing cash flow safety and sustainable operations [15] Production Indicators - As of January-February 2026, the survival rate for pigs was 83%-84%, with a weaning-to-market survival rate above 89% [16] - Key production metrics are gradually improving, indicating a potential further decrease in farming costs [16] Cash Flow Management - The company is confident in cost reduction to enhance resilience during market fluctuations [18] - Financial structure optimization and stable banking relationships contribute to cash flow safety [18]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - This week, the pig price continued to decline, with the main contract 2605 down 2.5% for the week. The supply is abundant as farmers are actively selling, and some even have passive overstocking due to weak demand. Market sentiment is low, and the enthusiasm for secondary fattening is weak. Although there is pre - Tomb - Sweeping Festival stocking demand, it can't change the weak terminal consumption trend. The supply - demand pattern remains loose, and the pig price is expected to remain weak. Technically, the main 2605 contract's weekly K - line deviates from the moving average and is about to change the contract, with limited adjustment space due to lack of positive support [8]. 3. Summary by Directory 3.1 Zhoudu Yaodian Xiaojie (Weekly Key Points Summary) - **Market Review**: The pig price continued to decline this week, and the main contract 2605 dropped 2.5% for the week [8]. - **Market Outlook**: Supply is abundant, demand is weak, and the supply - demand pattern remains loose. The pig price is expected to remain weak. Technically, there may be short - term adjustments, but the space is limited [8]. 3.2 Futures Market - **Price Movement**: The futures price continued to decline this week, with the main contract 2605 down 2.5% for the week [8][12]. - **Net Position and Warehouse Receipts**: As of March 27, the net short position of the top 20 holders in the pig futures increased by 1970 hands to 66461 hands compared with last week, and the number of futures warehouse receipts was 483, a decrease of 568 from the previous week [18]. - **Contract Spreads**: The spread between lh2605 and lh2607 contracts is - 1215, and the spread between lh2605 and lh2609 contracts is - 2555 [22]. 3.3 Spot Market - **Base Difference**: This week, the base difference of the May contract is - 465 yuan/ton, and that of the July contract is - 1680 yuan/ton [29]. - **Spot Price**: The national average pig price this week is 9.41 yuan/kg, a decrease of 0.55 yuan/kg from last week. The average price of 15 - kg weaned piglets is 25.9 yuan/kg, a decrease of 0.72 yuan/kg from last week [39]. - **Pork and Sow Price**: On March 26, the national average pork price is 15.65 yuan/kg, a decrease of 0.09 yuan/kg from the previous week. The average price of binary sows is 32.45 yuan/kg, the same as the previous week [46]. - **Pig - Grain Ratio**: As of the week of March 18, 2026, the pig - grain ratio is 4.4, a decrease of 0.13 from the previous week [50]. 3.4 Industry Conditions 3.4.1 Upstream - **Sow Inventory**: In December 2025, the official sow inventory is 39610000 heads. According to Mysteel data, in February, the sow inventory of 123 large - scale farms decreased slightly by 0.01% month - on - month, and that of 85 small and medium - sized farms decreased by 0.11% month - on - month [52][56]. - **Pig Inventory**: At the end of the fourth quarter of 2025, the national pig inventory is 429670000 heads, a year - on - year increase of 0.5%. According to Mysteel data, in February, the pig inventory of 123 large - scale farms increased by 1.79% month - on - month, and that of 85 small and medium - sized farms increased by 1.36% month - on - month [60]. - **Slaughter Volume and Weight**: In February, the slaughter volume of 123 large - scale farms decreased by 12.95% month - on - month, and that of 85 small and medium - sized farms increased by 2.85% month - on - month. The average slaughter weight of pigs this week is 123.47 kg, an increase of 0.19 kg from last week [64]. 3.4.2 Industry Profit - **Pig and Poultry Breeding Profit**: As of March 27, the breeding profit of purchased piglets is - 189.87 yuan/head, a decrease of 48.39 yuan/head; the breeding profit of self - bred and self - raised pigs is - 344.24 yuan/head, a decrease of 46.56 yuan/head. The breeding profit of laying hens is - 0.26 yuan/head, an increase of 0.06 yuan/head week - on - week; the breeding profit of 817 meat - hybrid chickens is - 0.54 yuan/head, an increase of 0.08 yuan/head week - on - week [67]. 3.4.3 Import - In January and February 2026, China imported 70000 tons and 50000 tons of pork respectively, with a year - on - year decrease of 37.5% in February. The total import volume in January - February is 120000 tons, a year - on - year decrease of 33.33% [74]. 3.4.4 Substitute Products - As of the week of March 27, the price of白条鸡 is 13.7 yuan/kg, the same as last week. As of the week of March 26, the average price difference between standard and fat pigs is - 0.64 yuan/kg, a decrease of 0.01 yuan/kg from last week [78]. 3.4.5 Feed - As of March 26, the spot price of soybean meal is 3337.71 yuan/ton, a decrease of 67.72 yuan/ton from the previous week; the spot price of corn is 2452.55 yuan/ton, a decrease of 2.06 yuan/ton from the previous week [85]. - As of March 20, the closing price of the DCE pig feed cost index is 950.47, and the average price of fattening pig compound feed is 3.36 yuan/kg [89]. - From January to February 2026, the feed output is 51098000 tons, a year - on - year increase of 2.3%. In February, the sales of piglet feed decreased by 3.84% month - on - month and 2.77% year - on - year [94]. 3.4.6 CPI - As of February 2026, China's CPI increased by 1.3% year - on - year [99]. 3.4.7 Downstream - **Slaughter and Inventory**: In the 13th week of 2026, the slaughter enterprise's operating rate is 32.83%, an increase of 2.38 percentage points from last week and 6.23 percentage points year - on - year. The fresh - sales rate of key slaughter enterprises is 78.55%, a decrease of 1.62% month - on - month and 10.89% year - on - year; the frozen - product storage rate is 21.52%, an increase of 2.80% from last week and 4.38% year - on - year [103]. - **Slaughter Volume and Catering Consumption**: As of February 2026, the slaughter volume of designated pig slaughtering enterprises is 31770000 heads, a decrease of 27.86% from last month. From January to February 2026, the national catering revenue is 1026.4 billion yuan, a year - on - year increase [108]. 3.5 Pig - Related Stocks - The report mentions the stock trends of Muyuan Co., Ltd. and Wens Co., Ltd., but no specific analysis content is provided [110].

Summary of Conference Call on Swine Industry Industry Overview - The swine industry is currently facing significant challenges, with the average price of live pigs dropping to 9.6 CNY/kg, marking a historical low, and average losses per head reaching 350-400 CNY, indicating a deep loss phase [1][4] - The price of piglets has also fallen below the cost line of 280 CNY, disrupting cash flow for breeding farms and signaling an accelerated reduction in breeding sow capacity [1][4] Key Insights and Arguments - **Market Sentiment and Stock Performance**: Recent stock price declines in the swine breeding sector are attributed to market panic rather than fundamental issues within the industry. Concerns over liquidity and risk appetite have led to significant sell-offs, particularly in companies with high institutional holdings [2] - **Production Capacity Concerns**: The market is worried about the potential rapid reduction of breeding sow capacity, drawing parallels to previous cycles in 2022 and 2024 where capacity rebounded quickly after price recoveries. Current signals suggest a more pronounced capacity reduction in the coming months [3][4] - **Price Signals**: The current price of live pigs and piglets indicates a challenging market environment. The average weight of pigs at slaughter is at a four-year high, while demand is decreasing due to seasonal weather changes [4] - **Cost Pressures**: The industry is expected to see a more than 5% year-on-year increase in breeding costs in 2026, driven by rising feed prices, declining production efficiency, and reduced capacity utilization [5] Additional Important Points - **Future Price Expectations**: There is a limited expectation for piglet price rebounds in April and May due to downward adjustments in futures contracts and rising breeding costs, which may suppress restocking enthusiasm [5] - **Forward-Looking Indicators**: The price and discount rate of culling sows are critical indicators for assessing the speed of capacity reduction. A discount rate below 70% could confirm an acceleration in the culling of breeding sows, with rates below 50% indicating a severe capacity purge [6] - **Current Market Conditions**: The current discount rate for culling sows is around 70%, suggesting the industry may be at the beginning of a capacity reduction phase. Observing changes in this rate will be crucial for identifying potential investment opportunities in the sector [6]

Summary of Conference Call on Swine Industry Industry Overview - The swine industry is entering a phase of accelerated capacity reduction, with March's reduction rate significantly higher than January and February, driven by an oversupply of live pigs due to inventory backlog [1][2] - The financial pressure on the industry has surpassed the 2023 cycle, with nearly half of the listed pig companies having higher debt-to-asset ratios, indicating a deep cash loss phase that suggests the current capacity reduction will be deeper and longer than expected [1][3] Key Insights and Arguments - Despite expectations of a slight rebound in pig prices in May and June, prices are unlikely to reach the breakeven cost of 13 RMB/kg, leading to continued losses and ensuring the capacity reduction logic remains intact [1][4] - The "anti-involution" policy is expected to be a strong theme in 2026, with increased regulatory measures prompting most companies to adjust their output and breeding plans, accelerating the elimination of outdated capacity [1][5] - The price of piglets has fallen below the breakeven point, signaling a negative feedback loop that reflects market pessimism about future pig prices, which will force upstream breeding capacity to clear out [1][6] Financial Performance and Market Expectations - The industry is experiencing significant cash losses, with average losses per pig ranging from 3 to 4 RMB, which has been priced into the market [6] - Financial reports are expected to validate the capacity reduction logic through increased debt ratios and declining biological assets, confirming the necessity for capacity clearance [6][7] - The current price of live pigs is around 9.6 RMB/kg, with piglet prices declining weekly, indicating a critical state of losses in the piglet market, which is a key indicator of the industry's capacity reduction [6][7] Investment Strategy - The investment strategy should focus on cost-leading companies, recommending Muyuan Foods, Dekang Agriculture, and Wens Foodstuffs, while also monitoring Tian Kang Biological, Shennong Group, Lihua Stock, and Juxing Agriculture for potential opportunities [1][7] - The current phase is seen as the beginning of a major capacity reduction wave, with expectations that the depth and duration of this cycle will exceed that of 2023, setting the stage for a potential price increase in the next cycle [7]

Fixed Income - The relationship between stocks and bonds has shown new changes since 2026, particularly due to shifts in investor structure and inflation expectations, indicating a potential for short-term co-movement under volatile conditions [2] - The expansion of fixed income + products in 2025, especially the significant increase in secondary bond funds, suggests a rising proportion of funds holding both bond and equity positions, leading to a more consistent marginal funding source for both ends [2] - In the context of strong equity markets, the pressure of "strong stocks, weak bonds" may re-emerge, particularly if the financial sector strengthens, while different themes in equity markets can have varying impacts on the bond market [3] - Geopolitical conflicts primarily influence the stock-bond relationship through rising oil prices and inflation expectations, which can weaken the stability of bonds as a safe haven [3] - Despite short-term pressures on the bond market, particularly on long-duration and highly traded varieties, the overall medium to long-term outlook remains supported by allocation forces and policy environment [4] Agriculture - The ongoing conflicts in the Middle East are expected to drive an upward trend in agricultural products, with rising energy prices enhancing the economic viability of biodiesel and increasing demand for vegetable oil raw materials [9] - Recent price increases in international soybeans, soybean meal, and soybean oil indicate a bullish outlook for grain prices, benefiting planting companies and agricultural processing firms [9] Pets - The appreciation of the RMB may impact the profitability of some companies' export businesses, but those with overseas production capacity and order growth are likely to see performance gains [10] - The domestic pet market is experiencing rapid growth, highlighted by recent large pet exhibitions in cities like Beijing and Shenzhen, indicating a robust development trend in the industry [10] Livestock - Current trends show a decline in pig prices below 10 CNY/kg, with expectations for continued price drops and rising costs due to higher prices for corn and other agricultural products, complicating the cost structure for the livestock industry [11]