Deep loss!

The performance forecasts for the first three quarters recently released by many pig breeding companies intensively seem to have opened a "tragic meeting"

Will the price of live pigs usher in a reversal? How long can "10 yuan pork" last? In the face of the recent price rebound, industry experts are not optimistic.

Facing the future, the price of live pigs will continue to fall, and the keywords of the current pig industry have turned into a situation of deep loss

Brokers China reporter learned from the "2021 China Agriculture and Animal Husbandry Industry (Derivatives) Conference Pig Forum and China Pig Trade Conference" that 19 of the top 20 leading companies in pig breeding have submitted delivery warehouse application materials to DCE , 11 became the delivery warehouses for pig futures

The pig price will remain low until the first half of next yearKUT China Feed Industry Information Network-Based on feed, serving animal husbandry

In the past month, under the expectation of a rebound in pork prices, Wen's shares, Muyuan shares, Aonong Biotech and other stocks have seen consecutive rises

Zhu Zengyong, chief expert of international livestock product production and trade monitoring and early warning of the Ministry of Agriculture and Rural Affairs, said that the overall loose supply of pork will not change in the short term, and the low pig price will continue until the first half of next year

In the current A-share listed companies, as long as the main business involves pig raising, no matter how large or small the proportion is, they seem to fall into a vicious circle of losses

"When there is a lot of domestic pork, I hope to encourage meat products to increase exports and stabilize the live pig market environment

　　In addition, while the price of live pigs has fallen sharply, the cost of feed raw materials and other live pig breeding costs are rising rapidly.

　　More industrial companies participate in the pig futures marketKUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Currently, the key word of the pig industry has shifted from loss to deep loss

　　"Alleviating the impact of large fluctuations in pork prices on the industry is a problem that must be solved for the high-quality development of China's pig industry.

　　Statistics show that since its listing on January 8, live pig futures have been operating smoothly and the market scale has steadily expanded.

　　At present, more than ten listed companies including Muyuan shares have issued announcements that they plan to use the futures market for risk management auxiliary operations

　　In particular, since May, the price of live pigs has entered a rapid downward channel.

　　"The launch of live pig futures now seems to be the beginning of a major change in the live pig industry.

　　Qin Jun believes that it can work with other pig companies, slaughter companies, and companies related to the industry chain to explore various new business models

　　In addition, the reporter was also informed that this year DCE strongly supports small and medium-sized farmers to use "insurance + futures" to achieve stable income and increase income.
A total of about 132 million yuan has been invested in the breeding of "insurance + futures" project, which will guarantee the income of farmers in the "DCE 131 live pig "insurance + futures" projects have been established in the "Plan", covering 27 provinces across the country, with a maximum loss rate of 405%
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　At the same time, in order to improve market risk-carrying capacity and service capabilities, live pig futures will increase warehouses and increase efficiency under the premise of effective risk prevention and control, and incorporate more industrial enterprises into the live pig futures delivery system, continue to promote intelligent delivery supervision, and improve delivery To improve efficiency and quality, continue to improve extended services such as diversified delivery, deepen the construction of agricultural product ecosystems, and provide more diversified and personalized risk management services for breeding companies
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

 　　The performance forecasts for the first three quarters recently released by many pig breeding companies intensively seem to have opened a "tragic meeting"
.
Faced with such a huge price risk, hog companies are actively using derivative tools to reduce losses
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Will the price of live pigs usher in a reversal? How long can "10 yuan pork" last? In the face of the recent price rebound, industry experts are not optimistic.
Instead, they reminded that the recent rebound in prices may have overdrawn the rebound at the end of the year
.
In the short term, the overall loose supply of pork will not change, and the sluggish pig price will continue until the first half of next year
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Facing the future, the price of live pigs will continue to fall, and the keywords of the current pig industry have turned into a situation of deep loss
.
In response to the continued price downturn, more companies have begun to actively seek price risk management
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Brokers China reporter learned from the "2021 China Agriculture and Animal Husbandry Industry (Derivatives) Conference Pig Forum and China Pig Trade Conference" that 19 of the top 20 leading companies in pig breeding have submitted delivery warehouse application materials to DCE , 11 became the delivery warehouses for pig futures
.
In addition, more than 60 breeding companies have applied for hedging qualifications, and more than 2,000 industrial companies have participated in live pig futures transactions
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The pig price will remain low until the first half of next yearKUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In the past month, under the expectation of a rebound in pork prices, Wen's shares, Muyuan shares, Aonong Biotech and other stocks have seen consecutive rises
.
However, many experts are not optimistic about the sustainability of the rebound in live pig prices
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong, chief expert of international livestock product production and trade monitoring and early warning of the Ministry of Agriculture and Rural Affairs, said that the overall loose supply of pork will not change in the short term, and the low pig price will continue until the first half of next year
.
The recent rebound in pig prices is phased.
In the future, the supply of frozen pork may overdraft and rebound
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In the current A-share listed companies, as long as the main business involves pig raising, no matter how large or small the proportion is, they seem to fall into a vicious circle of losses
.
Zhu Zengyong pointed out that the excessive expansion of super-large farms will aggravate the increase in costs, leading to greater losses when pig prices are low
.
"The current reduction in pig production capacity will continue.
After the September loss, the reduction in production capacity will be further increased
.
It is recommended that farmers and related companies stabilize their minds and remain rational when faced with market fluctuations
.
"KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　"When there is a lot of domestic pork, I hope to encourage meat products to increase exports and stabilize the live pig market environment
.
" Chen Wei, executive vice president and secretary-general of the China Meat Association, suggested that China's pork production has recovered faster than expected, from a serious decline.
It took about a year and a half to basically recover.
This is also the shortest natural production cycle from the replacement of gilts to the launch of fat pigs.
It is estimated that the total output of pork and meat this year will be 54 million tons and 88 million tons respectively.
Around
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In addition, while the price of live pigs has fallen sharply, the cost of feed raw materials and other live pig breeding costs are rising rapidly.
The prices of corn and soybean meal are at historically high levels, and the price of feed for farmers exceeds 4,000 yuan per ton
.
Cai Huiyi, director of the National Biological Feed Engineering Center, said that the feed industry is rapidly integrating and concentrating under the large fluctuations in prices.
Especially in the past five years, it has been declining at a rate of about 1,000 companies per year, and the annual output is more than one million tons.
The output of more than 30 enterprises in China has accounted for 54.
6% of the national total
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　More industrial companies participate in the pig futures marketKUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Currently, the key word of the pig industry has shifted from loss to deep loss
.
According to data from the China Animal Husbandry Information Network, as of the beginning of October, the national average price of live pigs fell to below 11 yuan/kg, and the industry was in a deep loss state.
This is the first time that the price of live pigs has fallen below 11 yuan/kg since June 2018.
The price fell by 70%
.
The price decline is tragic, and the rate of decline is the fastest in history
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　"Alleviating the impact of large fluctuations in pork prices on the industry is a problem that must be solved for the high-quality development of China's pig industry.
We must play the role of the market and jointly help stabilize prices and ensure supply through the linkage between the futures and the current
market.
" Trading with hogs is a key link in the hog industry chain, just like the two sides of money.
If production is not good, the transaction is not good, and if the transaction is not good, it will affect the enthusiasm of production
.
In the future, a large number of agricultural and animal husbandry enterprises and financial institutions are required to actively participate in the trading of live pig spot and live pig futures to achieve an effective market connection, which not only allows producers to have enthusiasm, but also allows consumers to "eat at ease and eat safely
.
"KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Statistics show that since its listing on January 8, live pig futures have been operating smoothly and the market scale has steadily expanded.
From the initial day of the listing of 10,000 lots and 20,000 positions, it has steadily grown to the current 50,000 and 100,000 lots
.
LH2109, the first contract in live pig futures, was successfully delisted on September 27
.
As of September 27, live pig futures had been operating for 175 trading days, with a total trading volume of 3.
3195 million lots, a total trading volume of 1.
03 trillion yuan, and an average daily holding of 42,500 lots
.
Among them, the LH2109 contract volume was 1.
9097 million lots, the total turnover was 659.
113 billion yuan, and the average daily position was 16,700 lots
.
The average daily holdings of hog futures corporate clients accounted for 36%
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　At present, more than ten listed companies including Muyuan shares have issued announcements that they plan to use the futures market for risk management auxiliary operations
.
A total of more than 60 breeding companies have applied for hedging qualifications, and more than 2,000 corporate clients have participated in live pig futures trading
.
Among the top 20 leading companies in hog breeding, 19 have submitted application materials for delivery warehouses to DCE, and 11 have become hog futures delivery warehouses
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In particular, since May, the price of live pigs has entered a rapid downward channel.
Some large-scale breeding companies have successfully used the futures market to hedge their value, lock in slaughter prices, stabilize production, and ensure the profits of their main businesses
.
Farming companies have a clearer understanding of the role of the futures market, and their enthusiasm for participation has been further improved
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　"The launch of live pig futures now seems to be the beginning of a major change in the live pig industry.
This is a change from 0 to 1.

" Qin Jun, secretary of the board of directors and chief strategy officer of Muyuan Co.
, Ltd.
, said that with the smooth delivery of the September contract, the market is The degree of using hog futures contracts for hedging is gradually increasing, which is a very good signal
.
"We use some risk management methods to slow down the volatility of corporate profits
.
"KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Qin Jun believes that it can work with other pig companies, slaughter companies, and companies related to the industry chain to explore various new business models
.
Enterprises need not only transactions based on on-exchange standard contracts, but also various off-exchange innovative businesses.
The derivatives market needs the construction of multiple markets, and the combination of on-exchange and off-exchange.
Breeding companies can manage well according to their own business needs and risk preferences.
Risk management has a lot to do in the future
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In addition, the reporter was also informed that this year DCE strongly supports small and medium-sized farmers to use "insurance + futures" to achieve stable income and increase income.
A total of about 132 million yuan has been invested in the breeding of "insurance + futures" project, which will guarantee the income of farmers in the "DCE 131 live pig "insurance + futures" projects have been established in the "Plan", covering 27 provinces across the country, with a maximum loss rate of 405%
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry

　　At the same time, in order to improve market risk-carrying capacity and service capabilities, live pig futures will increase warehouses and increase efficiency under the premise of effective risk prevention and control, and incorporate more industrial enterprises into the live pig futures delivery system, continue to promote intelligent delivery supervision, and improve delivery To improve efficiency and quality, continue to improve extended services such as diversified delivery, deepen the construction of agricultural product ecosystems, and provide more diversified and personalized risk management services for breeding companies
.
KUT China Feed Industry Information Network-Based on feed, serving animal husbandry