牧业大周期十问十答

Summary of Key Points from Conference Call Records Industry Overview - The global beef supply is expected to face a shortfall of 4%-6% over the next two to three years, leading to synchronized price increases for beef and dairy products due to a contraction in supply worldwide [1][3] - The domestic beef consumption is approximately 12 million tons annually, with a market size nearing 1 trillion yuan, but the industry is highly fragmented, with 95% of production capacity provided by small-scale farmers, resulting in significant losses and capacity reductions [1][4][5] Beef Industry Insights - The beef farming cycle lasts about three years, and the industry is currently experiencing deep losses due to factors such as consumption growth and the pandemic, with expectations of a price increase around late July to August 2025, potentially lasting until 2027 [1][6] - The breeding cow capacity has decreased by over 30%, and slaughter data indicates a higher-than-average proportion of breeding cows being processed, which supports future price increases [1][7] - The weight of fattening bulls has declined by 20%, indicating the beginning of capacity clearance, and a reduction in the number of culled breeding cows post-Spring Festival will lead to a significant contraction in beef supply, resulting in a substantial price increase in the second half of the year [1][8] Global Beef Supply Dynamics - Major beef-producing countries like the US and Brazil are experiencing declines in cattle inventory, with US beef futures reaching record highs, leading to increased import prices and reduced import volumes, which will have limited impact on domestic dining and consumer spending [1][9] Dairy Industry Insights - The domestic dairy industry has seen a nearly 10% reduction in capacity, with expectations of accelerated capacity reduction in the third quarter. The current low milk prices are causing cash flow losses across the industry, and if prices do not recover, this will further accelerate capacity reduction [2][10] - The dairy industry is characterized by a higher degree of scale, with 70%-80% of production being large-scale. The top three companies hold over 20% market share, and a potential rise in milk prices could help alleviate cash flow issues for leading firms [10][11] Future Market Trends and Investment Opportunities - The beef and dairy markets are expected to experience significant price increases over the next two to three years due to global supply contractions. Investment opportunities are seen in leading dairy companies listed in Hong Kong, such as YouRan Dairy, which are currently in a challenging phase but are expected to improve profitability as capacity reduces and prices rise [11] - Companies like Bright Dairy, which import quality resources from New Zealand, are also expected to benefit from the global price increases, showcasing strong growth potential in the agricultural cycle [11]