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Since entering the second half of the year, pig prices have continued to break through highs, and in the regular off-season after the National Day, egg prices have also shown a clear upward trend
of "off-season is not light".
Downstream meat and eggs entered the sales market, and in the upstream of the breeding industry, feed also ushered in a rise
in production and sales.
According to Brick's agricultural big data, the feed of fattening pigs and broiler chickens in the first week of November increased by 13.
22% and 21.
66% respectively compared with the same period last year.
At the end of October, the wholesale prices of fattening pigs and broiler batches in the national market were 4.
05 yuan / kg and 4.
06 yuan / kg respectively, and in the first week of November, many feeds rose sharply again, equivalent to an increase of 0.
05 yuan per kilogram, and the price of fattening pigs and broiler batches reached 4.
1 yuan / kg, constantly hitting a record high
.
Price trend of livestock and poultry batches from 2010 to present, image: Brick Agricultural Big Data
New Hope Liuhe said in an interview with Interface News that mainly livestock and poultry feed, feed prices in most areas increased in November compared with October, pig feed increased by about 70-80 yuan / ton, poultry feed increased by 120-130 yuan / ton
.
In addition, Zhengbang, Tongwei and other large feed enterprises under a number of companies issued a price increase notice, per ton of 50~300 yuan, according to CaiLian News, this has been the 12th comprehensive price
increase in the feed industry this year.
In terms of output, data from the "National Feed Production Situation in September 2022" released by the China Feed Industry Association shows that in September 2022, the national industrial feed output was 28.
33 million tons, an increase of 7.
5% month-on-month and 3.
1%
year-on-year.
In the previous month, the year-on-year data were all down, and the month-on-month growth rate in September also hit a new high
for the year.
But industry insiders also see the overall downward trend
in feed prices.
"At present, pig prices have weakened to a certain extent, and the secondary fattening of pigs has weakened after mid-October, and after pig prices have returned, it is more difficult to transmit high prices of feed raw materials
downward.
In addition, the arrival of soybeans in November and December was about 10 million tons, and the supply of soybeans improved, and more soybean meal could be produced," Lin Guofa, research director of Brick Agricultural Products Collective Shopping Network, predicted in an interview with Interface News, "The spot price of soybean meal in December will fall by about 500 yuan / ton compared with the beginning of November, which is conducive to the reduction
of feed production costs.
" ”
"However, there are still high price expectations in the corn market, and although feed prices have fallen overall, the decline has been limited," Lin added
.
Higher raw material prices push up feed costs
Referring to the reasons for the increase in feed prices in this round, New Hope Liuhe said that the increase rate will be different in different regions, mainly related to market competition and raw material costs; The price trend of livestock and poultry feed is basically the same, which is greatly affected by raw materials
.
Looking back at the feed market in recent years, in the two and a half years since about mid-2020, the cumulative increase in feed prices has reached 35%, of which the largest increase is mainly concentrated in the end of 2020 to the first quarter of 2021, the first quarter of 2022 and the third quarter of 2022 to the present, and the increase in feed prices is mostly accompanied by the increase
in raw material costs.
From late 2020 to Q1 2021, feed increases were mainly driven by a sharp increase in corn prices and record
highs.
Subsequently, a large number of wheat substitutions stabilized the supply of feed raw materials from the second quarter to the end of 2021, resulting in stable prices
.
The increase in feed prices in the first quarter of this year was mainly caused
by the reduction in soybean production in South America at the end of 2021 and the higher raw material costs driven by the Russia-Ukraine conflict in February 2022.
The trend of this round of feed price increases is highlighted in the third quarter
of this year.
The global food crisis has led to a tight supply of feed raw materials, coupled with the sharp increase in pig prices, which has driven the price of eggs, broilers and ducks up, and the feed demand is strong and the downstream livestock and poultry prices can be smoothly transmitted, and the comprehensive reasons have pushed feed prices higher
.
National corn and soybean meal price trend since 2020, Image: Brick Big Data
Brick big data shows that as of November 8, the average price of soybean meal in the country was 5550 yuan / ton, which was at a historical high, up 2150 yuan / ton from 3400 yuan / ton in the same period last year; Corn prices are also at a historical high, with the national corn price at 2880 yuan / ton, up 190 yuan / ton
from 2690 yuan / ton in the same period last year.
The price of corn and soybean meal increased, which increased feed production costs by 400 yuan/ton
in early November compared with the same period last year.
According to the 2022 half-year report of Haida Group, the company, like other feed companies, reduced the level of profitability to varying degrees in the first half of the year, slowing down the price increase of feed products to maintain market share
.
High costs squeeze profit margins
In this wave of feed rise, many companies also took advantage of the momentum of the boom market and ushered in a wave of performance in
the third quarter.
In 2021, Haida Group, which has a market share of about 6.
69% and ranks second in the national feed industry, achieved feed sales of about 15.
03 million tons in the first three quarters of the overall decline of the industry, a year-on-year increase of 7%.
At the results briefing on October 21, Haida Group said that livestock and poultry feed is still in an upward trend
from the perspective of the large cycle.
In order to further increase its market share, Haida Group added 8 feed bases in the first half of the year, increasing production capacity by about 2 million tons
.
The results for the first three quarters of 2022 released by Hefeng Co.
, Ltd.
show that the company's operating income in the first three quarters was 23.
522 billion yuan, a year-on-year increase of 8.
08%; The net profit attributable to the parent was 350 million yuan, a year-on-year increase of 625.
67%.
The operating income in the third quarter was 9.
735 billion yuan, a year-on-year increase of 19.
89%; The net profit attributable to the parent was 303 million yuan, a year-on-year increase of 249.
16%.
According to the company's disclosure, the feed business is the largest source of revenue for Hefeng Co.
, Ltd.
, achieving revenue of 15.
357 billion yuan in 2021, accounting for 52.
11%
of the revenue.
Despite the good business performance, the rise in raw material prices and the previous downturn in the downstream aquaculture industry have also affected the profits
of feed companies.
New Hope Six achieved revenue of 100.
419 billion yuan in the first three quarters of this year, a year-on-year increase of 6.
29%, and it was also the first time since its listing that its revenue in the first three quarters exceeded 100 billion
.
The net profit attributable to the parent in the third quarter was 1.
433 billion yuan, a year-on-year increase of 147.
99%.
Despite the good Q3 performance and the further increase in feed prices, New Hope Liuhe still told Interface News that "the overall profit of the company's feed business has improved month-on-month, but it is still somewhat lower than last year"
.
"Because this year overall, the downstream livestock and poultry breeding volume has decreased compared with last year, and the downstream demand has been affected; In addition, the breeding link only began to recover profitability in the second half of the year, which also made the raw material cost pressure faced by the upstream feed link impossible to transmit all to the downstream, and eventually squeezed the profit
of the feed link.
The relevant person in charge of the enterprise further explained
.
Wang Zongli, director and secretary general of China Feed Industry Association, previously said in the industry conference that China is a big country in the animal husbandry industry and a big country in feed consumption, and the output of pork, poultry eggs and aquatic products ranks first in the world, and feed output ranks first
in the world for 11 consecutive years.
At present, the import dependence of soybean meal exceeds 85%, how to reduce the amount of soybean meal and save protein resources is very important
in the context of increasingly severe constraints on the development of the industry.
In this industry context, soybean meal reduction and substitution is still the focus
of ensuring food security and feed price stability.
In response to the rising price of soybean meal raw materials, many large feed enterprises have invested in the research and development of alternative technologies
for feed soybean meal reduction.
According to data released by the Ministry of Agriculture and Rural Affairs, a total of 11 million tons of soybean meal was saved in the feed consumed by the national aquaculture industry in 2021, and a total of 8 agricultural leading enterprises such as Makihara Co.
, Ltd.
and New Hope Liuhe reduced the use of soybean meal by a total of 4.
08 million tons in 2021, becoming a typical case
of soybean meal reduction and substitution in China's feed.
;
;Since entering the second half of the year, pig prices have continued to break through highs, and in the regular off-season after the National Day, egg prices have also shown a clear upward trend
of "off-season is not light".
Downstream meat and eggs entered the sales market, and in the upstream of the breeding industry, feed also ushered in a rise
in production and sales.
in production and sales.
According to Brick's agricultural big data, the feed of fattening pigs and broiler chickens in the first week of November increased by 13.
22% and 21.
66% respectively compared with the same period last year.
At the end of October, the wholesale prices of fattening pigs and broiler batches in the national market were 4.
05 yuan / kg and 4.
06 yuan / kg respectively, and in the first week of November, many feeds rose sharply again, equivalent to an increase of 0.
05 yuan per kilogram, and the price of fattening pigs and broiler batches reached 4.
1 yuan / kg, constantly hitting a record high
.
22% and 21.
66% respectively compared with the same period last year;
Price trend of livestock and poultry batches from 2010 to present, image: Brick Agricultural Big Data
New Hope Liuhe said in an interview with Interface News that mainly livestock and poultry feed, feed prices in most areas increased in November compared with October, pig feed increased by about 70-80 yuan / ton, poultry feed increased by 120-130 yuan / ton
.
In addition, Zhengbang, Tongwei and other large feed enterprises under a number of companies issued a price increase notice, per ton of 50~300 yuan, according to CaiLian News, this has been the 12th comprehensive price
increase in the feed industry this year.
In terms of output, data from the "National Feed Production Situation in September 2022" released by the China Feed Industry Association shows that in September 2022, the national industrial feed output was 28.
33 million tons, an increase of 7.
5% month-on-month and 3.
1%
year-on-year.
In the previous month, the year-on-year data were all down, and the month-on-month growth rate in September also hit a new high
for the year.
But industry insiders also see the overall downward trend
in feed prices.
in feed prices.
"At present, pig prices have weakened to a certain extent, and the secondary fattening of pigs has weakened after mid-October, and after pig prices have returned, it is more difficult to transmit high prices of feed raw materials
downward.
In addition, the arrival of soybeans in November and December was about 10 million tons, and the supply of soybeans improved, and more soybean meal could be produced," Lin Guofa, research director of Brick Agricultural Products Collective Shopping Network, predicted in an interview with Interface News, "The spot price of soybean meal in December will fall by about 500 yuan / ton compared with the beginning of November, which is conducive to the reduction
of feed production costs.
" ”
"However, there are still high price expectations in the corn market, and although feed prices have fallen overall, the decline has been limited," Lin added
.
Higher raw material prices push up feed costs
The increase in the price of raw materials pushes up feed costs, and the increase in raw material prices pushes up feed costsReferring to the reasons for the increase in feed prices in this round, New Hope Liuhe said that the increase rate will be different in different regions, mainly related to market competition and raw material costs; The price trend of livestock and poultry feed is basically the same, which is greatly affected by raw materials
.
Looking back at the feed market in recent years, in the two and a half years since about mid-2020, the cumulative increase in feed prices has reached 35%, of which the largest increase is mainly concentrated in the end of 2020 to the first quarter of 2021, the first quarter of 2022 and the third quarter of 2022 to the present, and the increase in feed prices is mostly accompanied by the increase
in raw material costs.
From late 2020 to Q1 2021, feed increases were mainly driven by a sharp increase in corn prices and record
highs.
Subsequently, a large number of wheat substitutions stabilized the supply of feed raw materials from the second quarter to the end of 2021, resulting in stable prices
.
The increase in feed prices in the first quarter of this year was mainly caused
by the reduction in soybean production in South America at the end of 2021 and the higher raw material costs driven by the Russia-Ukraine conflict in February 2022.
The trend of this round of feed price increases is highlighted in the third quarter
of this year.
The global food crisis has led to a tight supply of feed raw materials, coupled with the sharp increase in pig prices, which has driven the price of eggs, broilers and ducks up, and the feed demand is strong and the downstream livestock and poultry prices can be smoothly transmitted, and the comprehensive reasons have pushed feed prices higher
.
of this year.
National corn and soybean meal price trend since 2020, Image: Brick Big Data
Brick big data shows that as of November 8, the average price of soybean meal in the country was 5550 yuan / ton, which was at a historical high, up 2150 yuan / ton from 3400 yuan / ton in the same period last year; Corn prices are also at a historical high, with the national corn price at 2880 yuan / ton, up 190 yuan / ton
from 2690 yuan / ton in the same period last year.
The price of corn and soybean meal increased, which increased feed production costs by 400 yuan/ton
in early November compared with the same period last year.
According to the 2022 half-year report of Haida Group, the company, like other feed companies, reduced the level of profitability to varying degrees in the first half of the year, slowing down the price increase of feed products to maintain market share
.
High costs squeeze profit margins
High cost squeezes profit marginsHigh costs squeeze profit marginsIn this wave of feed rise, many companies also took advantage of the momentum of the boom market and ushered in a wave of performance in
the third quarter.
In 2021, Haida Group, which has a market share of about 6.
69% and ranks second in the national feed industry, achieved feed sales of about 15.
03 million tons in the first three quarters of the overall decline of the industry, a year-on-year increase of 7%.
At the results briefing on October 21, Haida Group said that livestock and poultry feed is still in an upward trend
from the perspective of the large cycle.
In order to further increase its market share, Haida Group added 8 feed bases in the first half of the year, increasing production capacity by about 2 million tons
.
The results for the first three quarters of 2022 released by Hefeng Co.
, Ltd.
show that the company's operating income in the first three quarters was 23.
522 billion yuan, a year-on-year increase of 8.
08%; The net profit attributable to the parent was 350 million yuan, a year-on-year increase of 625.
67%.
The operating income in the third quarter was 9.
735 billion yuan, a year-on-year increase of 19.
89%; The net profit attributable to the parent was 303 million yuan, a year-on-year increase of 249.
16%.
According to the company's disclosure, the feed business is the largest source of revenue for Hefeng Co.
, Ltd.
, achieving revenue of 15.
357 billion yuan in 2021, accounting for 52.
11%
of the revenue.
Despite the good business performance, the rise in raw material prices and the previous downturn in the downstream aquaculture industry have also affected the profits
of feed companies.
of feed companies.
New Hope Six achieved revenue of 100.
419 billion yuan in the first three quarters of this year, a year-on-year increase of 6.
29%, and it was also the first time since its listing that its revenue in the first three quarters exceeded 100 billion
.
The net profit attributable to the parent in the third quarter was 1.
433 billion yuan, a year-on-year increase of 147.
99%.
Despite the good Q3 performance and the further increase in feed prices, New Hope Liuhe still told Interface News that "the overall profit of the company's feed business has improved month-on-month, but it is still somewhat lower than last year"
.
"Because this year overall, the downstream livestock and poultry breeding volume has decreased compared with last year, and the downstream demand has been affected; In addition, the breeding link only began to recover profitability in the second half of the year, which also made the raw material cost pressure faced by the upstream feed link impossible to transmit all to the downstream, and eventually squeezed the profit
of the feed link.
The relevant person in charge of the enterprise further explained
.
Wang Zongli, director and secretary general of China Feed Industry Association, previously said in the industry conference that China is a big country in the animal husbandry industry and a big country in feed consumption, and the output of pork, poultry eggs and aquatic products ranks first in the world, and feed output ranks first
in the world for 11 consecutive years.
At present, the import dependence of soybean meal exceeds 85%, how to reduce the amount of soybean meal and save protein resources is very important
in the context of increasingly severe constraints on the development of the industry.
In this industry context, soybean meal reduction and substitution is still the focus
of ensuring food security and feed price stability.
In response to the rising price of soybean meal raw materials, many large feed enterprises have invested in the research and development of alternative technologies
for feed soybean meal reduction.
According to data released by the Ministry of Agriculture and Rural Affairs, a total of 11 million tons of soybean meal was saved in the feed consumed by the national aquaculture industry in 2021, and a total of 8 agricultural leading enterprises such as Makihara Co.
, Ltd.
and New Hope Liuhe reduced the use of soybean meal by a total of 4.
08 million tons in 2021, becoming a typical case
of soybean meal reduction and substitution in China's feed.
