Bearish market sentiment warms hog futures drop sharply|Hog_Sina Finance_Sina.com

Research report text

1. Market analysis

The bearish sentiment in the market heats up, the major pig contract 2301 gapped sharply and opened below the 20,000 yuan/ton threshold, and the minor contract increased its position and fell. The major pig futures contract LH2301 opened at 19,890 yuan/ton and closed at 19,160 yuan/ton, a drop of 1,260 yuan/ton or 6.17%. The highest price was 19,900 yuan/ton, the price the lowest was 19,130 ​​yuan/ton , and the settlement price was 19,485 yuan/ton. The total trading volume was 27137 lots, and the position was 30332 lots, an increase of -1955 lots.

2. News situation

1. Prices of domestic and foreign ternary pigs as of December 8, 2022: (yuan/kg)

2. Profit from pig farming

According to data from my agricultural network, as of the week of December 2, the price of 7 kg piglets was 518.57 yuan/head, a drop of 25 yuan/head compared with 543.57 yuan/head in the Previous week. Outsourced piglet farm profit was 489.19 yuan/head, down 173.94 yuan/head from c663.13 yuan/head the previous week; the profit of self-propagation and self-breeding was 621.71 yuan/head, down 192.37 yuan/head from 814.08 yuan/head the previous week.

3. Pig production capacity

According to data released by the National Bureau of Statistics, according to data from the Ministry of Agriculture and Rural Affairs, there will be 43.79 million fertile sows nationwide in October 2022, which is 6.8% more than in normal stock of 41 million, up 0.4% MoM and 0.7% YoY. According to my agricultural sample data, there were 5,035,100 breeding sows in October, an increase of 137,400 or 2.8% from 4,897,700 the previous month. There were 30.6996 million commercial pigs available in October, an increase of 414,000 or 41.4 percent from 30.2856 million the previous month. A total of 7.6477 million commercial pigs were slaughtered in October, an increase of 434,500 or 5.7% from 7.2132 million the previous month.

4. Pig slaughter data

According to data from my agricultural network, the operating rate of slaughterhouse enterprises was 29.34% as of December 7, an increase of 0.45% from 28.89% last week. As of December 8, the profit of slaughterhouse enterprises was 45.64 yuan/head, a decrease of 2.49 yuan/head from 48.13 yuan/head the previous week. The frozen product storage capacity rate was 17.09%, down 0.34% from 17.43% the previous week.

5. Muyuan Co., Ltd.: The estimated number of live pigs to be slaughtered in 2022 will be increased to 61-62 million head

Muyuan Co., Ltd. on Dec. 6 announced an announcement on raising the forecast for the 2022 pig slaughter range. Combined with the recent changes in the company’s pig production and sales, the company increased the 2022 projected hog production range of 61 million to 62 million head, which is higher than the 50 million to 56 million hog range previously disclosed in the 2021 annual report.

The main reasons for the increase in the range of slaughter volume are: 1. Since the beginning of this year, the company has strengthened the whole process management of all aspects of pig farming and the efficiency indicators of all stages of pig farming are improved; it was 13.09% in the semester and 5.93% in July-November.

3. Summary

As the large pig enterprises have significantly accelerated their slaughter plans and the widening of the standard fertilizer price difference has prompted farmers and secondary fatteners to take advantage of the trend, the supply of live pigs on the market is increased significantly and some group companies cut prices and increased volume. Terminal consumption has currently improved, reflecting the strong cooling in the country, the demand for pork from residents is recovering and the situation of traditional cured meats is good, slaughterhouses have more orders for white strips and are more active in purchase of pork sources. Along with the optimization and adjustment of local epidemic prevention policies, catering consumption in various places has progressively shown signs of recovery. At present, the overall supply on the market is still relatively weak. The market outlook will focus on the strength of pork consumption from the supply side.

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