The Zhitong Finance App learned that Open Source Securities released a research report saying that in December, the price spread for fat pigs was concentrated to narrow, and pig prices continued to be under pressure in the short term. According to Yongyi Consulting, the average sales price of pigs nationwide in December 2023 was 14.34 yuan/kg, -1.87% month-on-month. Yongyi's monitoring sample slaughtered 5.672 million heads in December, +18.85% year-on-year and +13.52% month-on-month. Affected by the sufficient supply of fat pigs, by the end of December 2023, the premium for 150 kg fat pigs had narrowed to 0.18 yuan/kg compared to 120 kg, and the average weight of fat pigs had risen to 124.24 kg/head. Looking ahead to January 2024, pig supply pressure is still strong, but demand is still supported before the Spring Festival. Pig prices are expected to fluctuate slightly due to low fluctuations.

Open source securities views are as follows:

When fat pigs are concentrated, pig prices are not strong during the peak season, and it is expected that the decline in breeding will continue under multiple pressures

In December, when fat pigs were sold centrally, the spread of standard fertilizer narrowed, and short-term pig prices continued to be under pressure. According to Yongyi Consulting, the average sales price of pigs nationwide in December 2023 was 14.34 yuan/kg, -1.87% month-on-month. Yongyi's monitoring sample slaughtered 5.672 million heads in December, +18.85% year-on-year and +13.52% month-on-month. Affected by the sufficient supply of fat pigs, by the end of December 2023, the premium for 150 kg fat pigs had narrowed to 0.18 yuan/kg compared to 120 kg, and the average weight of fat pigs had risen to 124.24 kg/head. Looking ahead to January 2024, pig supply pressure is still strong, but demand is still supported before the Spring Festival. Pig prices are expected to fluctuate slightly due to low fluctuations.

The price spread of mao white improved month-on-month in December, and frozen meat prices fell to a low point in the same period in recent years due to high frozen product inventories. According to Yongyi Consulting, the price difference of Mao White in the December 2023 monitoring sample was 4.38 yuan/kg (+0.29 yuan/kg month-on-month, -2.09 yuan/kg year-on-year). The decline in pig prices and the improvement in the price spread of gross white are mainly due to terminal consumption acceptance. As of December 28, 2023, fresh pork sales rate had risen to 92.4%, and the national frozen product storage rate had risen to 20.2%. Affected by high stocks of frozen products, frozen meat prices fell to a low in the same period in recent years in December. It is expected that 2024Q1 frozen meat will continue to face shipping pressure, which will put pressure on pig prices.

In December, the loss of self-breeding pigs deepened, and sow production performance improved, and the reduction in 2024H1 breeding is expected to continue under multiple pressures. In December 2023, the average loss of self-breeding pigs in the industry was 246.55 yuan, further deepening the loss. Looking at the energy breeding column, the energy breeding column of Yongyi surveillance samples in December was -0.84%. The Ministry of Agriculture and Rural Affairs was able to reproduce 41.58 million heads in November. The MSY in the industry has recovered beyond pre-plague levels. With excess production capacity, the Ministry of Agriculture and Rural Affairs may later reduce the normal amount of energy production to 39 million heads. Looking ahead to 2024Q1, especially during the low consumption season after the Spring Festival, the conflict between pig supply and demand intensifies, and farmers' funds are compounded by a high incidence of fever. It is expected that diversification will continue or even accelerate. At this point, it is recommended to wait for the pig sector to recover and stabilize before it stabilizes.

Companies: The number of pigs released by listed pig companies in December was divided year over year, and the total number of listings varied from month to month

As of January 10, 2024, 11 major listed pig breeding companies have released pig sales data for December. Listed pig breeding companies listed a total of 15.117 million pigs in December, +21.55% over the same period last year. Muyuan Co., Ltd., Wen's Co., Ltd., New Hope, *ST Zhengbang, Tianbang Foods, Dabeinong, COFCO Jiajiakang, Aonong Biotech, Tiankang Biology, Tang Renshen, and Jin Xinnong sold 663.10/296.67/147.36/45.76/84.49/72.15/75.30/53.16/27.98/35.89/993 million heads respectively, +10%, +58.4%, -6%, -6.1%, +74.6%, +30.4%, +3.4%, +40.7%, + 24.4%, +154%

In terms of average listing weight, the three companies announced average listing weight. The average weight of commercial pigs sold by Wen's Co., *ST Zhengbang, and Dabeinong in December was 113.4/129.4/117.4 kg/head, respectively, with month-on-month changes of -7.5/-1.9/+0.7 kg/head, respectively.

In terms of average sales prices, the average sales prices of the eight major listed pig companies all fell month-on-month. Muyuan Co., Wen's shares, New Hope, *ST Zhengbang, Tianbang Foods, Dabeinong, COFCO Jiajiakang, and Tiankang Biotech's average sales prices for commercial pigs in December were 13.42/13.7/13.06/12.69/13.51/13.42/13.9/13.19 yuan/kg, respectively, with changes of -2%/-5.1%/-6.4%/-7.5%/-3.9%/-2.6%/-1.6%/-2.6%/-2.6%/-2.3%, respectively.

Risk warning: Abnormal swings in pig prices, uncertainty about the epidemic, and the decline in breeding costs for listed companies falls short of expectations.