HuaChuang Securities: After a decline in September, the price of broiler chickens stabilized, while the price of chicks fluctuated at a high level

According to the Zhitong Finance APP, Huachuang Securities released a research report stating that in early September, the breeding sector was actively replenishing stock, and the demand side was cross-regional receiving chicks, with the price of white feather chick seedlings running strong, increasing slightly from 3.27 yuan/chick to 3.31 yuan/chick; in mid-September, the price of live chickens declined, with increased costs for the breeding sector and tight supply plans for breeding stock, leading to a slight decrease in the price of white feather chick seedlings, which ranged between 3.03-3.20 yuan/chick; in late September, various factors drove chick prices to rise and then stabilize, with an average price fluctuating between 3.13-3.28 yuan/chick. In terms of meat chickens, after a price increase, chicken prices fluctuated at a high level, with a loss of 1 yuan/chick in September for live chicken breeding, a significant decrease in profitability compared to the previous month, and a loss of 0.41 yuan/chick for hatcheries, also a significant decrease in profitability.

The main points of Huachuang Securities are as follows:

Live Chickens & Chick Seedlings: After a decline, live chicken prices stabilized, and chick seedling prices fluctuated at a high level, with live chicken prices stabilizing after a drop in September.

Due to transactions lasting over 20 days, the monthly average transaction price before the shelf fell. 1) Previous oversupply: Short-term increase in chicken supply in Shandong, with slaughterhouses negotiating prices for sales, leading to factories pressing prices for chickens. 2) After mid-month, a linear operation: Slaughter enterprises prepared in advance for the National Day sales, implementing a strategy of "stabilizing live chicken inventory." Dispersed purchasing by distributors suppressed the upward momentum of live chicken prices, and actual transactions for live chickens remained stable in the mid to late month.

September Chick Seedling Prices Fluctuated at a High Level

In early September, the breeding sector was actively replenishing stock, and the demand side was cross-regional receiving chicks, with the price of white feather chick seedlings running strong, increasing slightly from 3.27 yuan/chick to 3.31 yuan/chick; in mid-September, the price of live chickens declined, with increased costs for the breeding sector and tight supply plans for breeding stock, leading to a slight decrease in the price of white feather chick seedlings, which ranged between 3.03-3.20 yuan/chick; in late September, various factors drove chick prices to rise and then stabilize, with an average price fluctuating between 3.13-3.28 yuan/chick.

Chicken Meat: After a price increase, chicken prices fluctuated at a high level

After a price increase, chicken prices fluctuated at a high level. The national average price for white feather meat chickens in September was 6.99 yuan/kg, down 3.22% year-on-year and down 2% month-on-month; the average price of chicken products was 8712.92 yuan/ton, up 3.77% year-on-year and down 2.18% month-on-month. The main countries and breeds for introduction and updates in September included France's AA+, Li Che, and domestic breeds. Among them, the French Li Feng breed accounted for 25.00%, AA+ breed accounted for 47.73%, and domestic breeds accounted for 27.27%. In terms of grandparent stock capacity, as of September 2025, the average stock of grandparent chickens in production was 1.36 million sets, up 1.7% year-on-year and down 1.4% month-on-month; the average stock of backup grandparent chickens was 670,000 sets, down 11.6% year-on-year and down 10.7% month-on-month.

In terms of parent stock capacity, as of September 2025, the average stock of parent stock in production at the association's sample points was 22.92 million sets, up 2.0% year-on-year and up 5.6% month-on-month; the average stock of backup parent breeding chickens was 15.66 million sets, down 1.7% year-on-year and up 3.1% month-on-month. The price of parent stock chick seedlings in September was 47.47 yuan/set, with the latest quote for week 41 of 2025 being 40.55 yuan/set.

In summary, both the chick seedling sector and the live chicken breeding sector saw a month-on-month decline. In September, live chicken breeding incurred a loss of 1 yuan/chick, with a significant decrease in profitability compared to the previous month: hatcheries incurred a loss of 0.41 yuan/chick, also with a significant decrease in profitability Investment Advice: Long-term focus on the improvement of poultry demand under the expectation of consumption recovery

Looking ahead to 2025, from the supply side, the upstream breeding source of broilers is sufficiently supplied. Key attention should be paid to the sustainability of the impact of overseas avian influenza outbreaks on the introduction of breeds, as well as the impact of domestic diseases such as duck plague on the breeding of commercial broilers and the egg-laying performance of breeding hens. From the demand side, the sluggish end consumption has always been a key factor suppressing the demand and prices of chicken products, thereby affecting the profits of the industry chain. In 2025, under the backdrop of expanding domestic demand, chicken consumption is expected to see a boost. With breeding costs still operating at low levels, broiler companies are likely to experience profit improvement and valuation recovery. Key stocks to focus on include Sunner (002299.SZ), YISHENG (002458.SZ), and Wellhope (603609.SH).

In addition, as domestic white feather broiler varieties continue to be researched, developed, and upgraded, it is expected that the efficiency gap with overseas varieties in commercial breeding will narrow in the future. From a long-term perspective, the market share of domestic varieties is expected to continue to increase.

Risk Warning

Overseas grandparent chicken introduction exceeds expectations, outbreaks of domestic avian influenza and other breeding diseases, decline in chicken prices, major food safety incidents, and systemic risks in the macro economy