Huatai Securities: De-stocking of Live Pig Capacity Has Begun, Reiterates Recommendation for Live Pig Breeding Sector

Huatai Securities' research report points out that, according to Wind, on April 14, the national average price of live pigs was 8.7 yuan/kg, falling below the lowest level since 2008. This corresponds to an average loss of approximately 450 yuan/head for self-breeding and self-raising operations within the industry, exceeding the deepest single-week loss of the previous cycle. Since March, as the industry has fallen into deep cash flow losses, the de-stocking of breeding sows has restarted. Based on calculations using capacity and efficiency indicators, piglet supply is expected to remain high from Q2 to Q3 2026. It is highly probable that the industry will continue to experience cash flow losses and consumption, and non-linear capacity reduction could occur at any time, forming a strong catalyst for the sector. Huatai reiterates its recommendation for the live pig breeding sector.