According to the Zhitong Finance APP, Huafu Securities released a research report stating that on September 12, the national average price of live pigs was 13.35 yuan/kg, a decrease of 0.44 yuan/kg week-on-week, reaching a new low for the year. The average weight has slightly increased, with strong enthusiasm for the overall slaughter of large pigs in the breeding sector. Coupled with the drop in temperatures in many regions, the growth rate of pigs has accelerated, leading to a slight rebound in the average slaughter weight. As of the week ending September 11, the average slaughter weight of live pigs was 128.32 kg (an increase of 0.09 kg week-on-week). In the short term, the expected slaughter volume for September from Steel Union/Zhuochuang/Yongyi sample enterprises is +1.29%/+4.11%/+3.92% month-on-month, increasing supply pressure, and pig prices may remain under pressure, with attention on the stockpiling boost during the Mid-Autumn Festival and National Day in late September. In the long term, recent policies have repeatedly emphasized capacity control, which is expected to accelerate the elimination of inefficient capacity in the industry, pushing the long-term price center of pigs upward, with low-cost high-quality pig enterprises expected to gain excess returns.

The main views of Huafu Securities are as follows:

Pig Farming

August Sales Report: Continuous increase in slaughter volume and decrease in weight for pig enterprises. In August, 18 pig enterprises collectively slaughtered 15.8449 million pigs, an increase of 6.96% month-on-month and 29.85% year-on-year. In terms of average weight, excluding the impact of piglets and breeding pigs, the average slaughter weight of 5 listed pig enterprises is estimated to be 120.95 kg, a decrease of 0.27% month-on-month.

Market Situation This Week: Pig prices continue to decline. This week, the breeding sector is actively slaughtering, and pig prices remain under pressure. On September 12, the national average price of live pigs was 13.35 yuan/kg, a decrease of 0.44 yuan/kg week-on-week, reaching a new low for the year. The average weight has slightly increased, with strong enthusiasm for the overall slaughter of large pigs in the breeding sector. Coupled with the drop in temperatures in many regions, the growth rate of pigs has accelerated, leading to a slight rebound in the average slaughter weight. As of the week ending September 11, the average slaughter weight of live pigs was 128.32 kg (an increase of 0.09 kg week-on-week).

In the short term, the expected slaughter volume for September from Steel Union/Zhuochuang/Yongyi sample enterprises is +1.29%/+4.11%/+3.92% month-on-month, increasing supply pressure, and pig prices may remain under pressure, with attention on the stockpiling boost during the Mid-Autumn Festival and National Day in late September. In the long term, recent policies have repeatedly emphasized capacity control, which is expected to accelerate the elimination of inefficient capacity in the industry, pushing the long-term price center of pigs upward, with low-cost high-quality pig enterprises expected to gain excess returns. It is recommended to pay attention to MUYUAN (002714.SZ), Dekang Agriculture (02419), WENS (300498.SZ), Juxing Agriculture (603477.SH), and Shennong Group (605296.SH).

Animal Husbandry

Beef Cattle: Prices stabilize after a short-term rise, and medium to long-term beef cattle supply remains tight, with the beef cattle cycle expected to rise in 2026-2027. The domestic beef cattle farming market is sluggish in 2023-2024, with long-term losses in farming and significant capacity elimination, leading to a more than 8% year-on-year decline in the number of new calves from January to November 2024. Since the beginning of 2025, beef prices have rebounded, with prices for calves/fattened bulls at 32.44/25.97 yuan/kg on September 12, remaining stable week-on-week, and having increased by 35%/10% since the beginning of the year. The recent stabilization of the domestic beef cattle market after a rise is mainly due to seasonal effects from the descent of cattle. In the medium to long term, the reduction of breeding cows will gradually lead to a decrease in beef cattle slaughter volume, with beef prices expected to reach a turning point in the second half of 2025, entering an upward cycle in 2026-2027 Raw Milk: Milk prices fluctuate at low levels, and capacity reduction is expected to continue. Since the end of 2021, raw milk prices have been on a downward trend for nearly four years. As of September 5, 2025, the industry raw milk price has fallen to 3.03 yuan/kg, a cumulative decline of 31% from the peak of the cycle. The drop in milk prices has led to continuous losses in the industry, triggering capacity reduction, with the number of dairy cows in China decreasing by 5.7% year-on-year in February 2025. Currently, dairy farming is still in a loss-making state, and coupled with the need for significant cash investment in silage feed procurement in the third quarter, the industry's cash flow may further deteriorate, and capacity reduction is expected to continue. As capacity reduction translates into supply contraction, the raw milk price cycle is expected to stabilize and rebound. The large-scale livestock cycle has begun, focusing on the resonance of beef cattle and raw milk prices, and paying attention to YouRan MuYe (09858) and China Shengmu (01432).

Poultry Sector

Broilers: Prices weaken. Recently, there has been a concentrated release of chicken supply in Shandong and Hebei provinces, increasing market supply. Coupled with sluggish sales of frozen products at the slaughter end, the price of live chickens has fallen, and the price of chicks has been adjusted downwards. On September 12, the industry price for white feather broilers was 7.02 yuan/kg, a week-on-week decrease of 0.20 yuan/kg; the industry price for meat chicken chicks was 3.25 yuan/chick, a week-on-week decrease of 0.15 yuan/chick. Currently, the overseas avian influenza epidemic continues to spread, with France lifting import restrictions while the U.S. and New Zealand still have import interruptions, which may further shrink upstream capacity for broilers. Attention should be paid to the sustainability of import restrictions. It is recommended to focus on Yisheng (002458.SZ), Shengnong Development (002299.SZ), and Hefeng (603609.SH).

Layer Chickens: Egg prices rebound, chick prices weaken. Boosted by Mid-Autumn Festival stocking, the average price of eggs from September 8 to 12 was 7.15 yuan/kg, a week-on-week increase of 0.62 yuan/kg. On September 12, the price of layer chicks was 2.6 yuan/chick, a week-on-week decrease of 0.40 yuan/chick. Currently, the overseas avian influenza epidemic continues to spread, making it more difficult to import from the U.S., and the supply gap for high-quality chicks may persist, with prices for high-quality chicks expected to remain in a relatively prosperous range. It is recommended to focus on Xiaoming (300967.SZ).

Agricultural Products: This week, soybean meal continues to fluctuate.

On the futures side, the soybean meal 2601 contract closed at 3079 yuan/ton on September 12, a week-on-week increase of 13 yuan/ton. On the spot side, the soybean meal spot price was 3060 yuan/ton on September 12, a week-on-week decrease of 24 yuan/ton. The September USDA supply and demand report was released, slightly raising the estimated planting area for U.S. soybeans in the 2025/2026 season to 81.1 million acres (an increase of 200,000 acres), slightly lowering the yield to 53.5 bushels/acre (a decrease of 0.1 bushel/acre), and slightly increasing the ending stock estimate to 300 million bushels (an increase of 10 million bushels). From September 14 to 17, China and the U.S. will hold talks again to discuss U.S. unilateral tariff measures and other economic and trade issues, paying attention to changes in China-U.S. trade policies and weather conditions for U.S. soybeans. It is recommended to focus on soybean meal ETFs.

Risk Warning

Risks of animal diseases, fluctuations in commodity prices, natural disasters, etc