Last month, the pig companies "sell more and lose more", and the trend is to reduce production capacity or reverse...

Eliminating outdated production capacity has become the consensus of the current pig industry, and listed pig companies may find it difficult to maintain the pace of expansion

In August, pig companies "sell the more they lose"

In August of this year, the sales volume and revenue of Muyuan, which ranked first in the industry in terms of market volume and revenue, both declined month-on-month

Zhengbang Technology, which ranks second in column volume, is also facing a situation of "selling more and losing money"

It is worth noting that the sales of live pigs of leading pig companies such as Muyuan Co.

Guo Gang, a pig analyst at the Agricultural Products Division of Shanghai Steel Union, told China Business Daily that from January to July this year, 11 listed pig companies had an average completion rate of 39.

Accelerated capacity elimination

At present, although the production capacity of listed pig companies is still being released, it has become the consensus of the industry to eliminate inefficient production capacity

Zhu Zengyong, a researcher at the Beijing Institute of Animal Husbandry and Veterinary Medicine, Chinese Academy of Agricultural Sciences, told reporters that after the increase in the price of live pigs in May, the industry has begun to eliminate sows, especially the three yuan that was adopted when the price of live pigs was high from 2019 to 2020.

What is the purpose of culled sows? The relevant person in charge of New Hope told the reporter of China Business Daily that some of the three-yuan pigs used as fattening pigs can also be sold to the market after being eliminated for slaughtering and processing of commercial pigs

In addition, in terms of the progress of eliminating inefficient production capacity, listed pig companies may lag behind retail investors

Actively eliminating low-efficiency sows may also have a certain impact on the performance of listed pig companies

Listed pig companies are in a dilemma

Will the listed pig companies take the initiative to reduce production, slow down the rate of slaughter, or continue to increase volume and seize the market? This is a dilemma multiple choice question

Judging from the completion rate of the slaughter tasks so far, during the downward stage of live pig prices, although the listed pig companies have to slow down the slaughter speed, compared with previous years, the rate of expansion is still very alarming

"The construction of pig farms and production expansion are also preparations for the next round of the'pig cycle'.

At present, the increase in production capacity is still the main reason for the decline in live pig prices, and the pig industry may struggle to survive in the short term