Animal Husbandry ETF (516670) "Deep V" rebounded to close the lower shadow line, giving birth to counteroffensive energy?
As of the close of trading on December 21, 2023, the CSI Animal Husbandry Index (930707) fell slightly by 0.03%, with constituent stocks rising more and falling less, Yike Food, Xiangjia Shares, Luoniushan, Xiantan Shares, etc. rose more than 1%; Aonong Biotechnology fell 9.34%, and it was also the only constituent stock that fell by more than 1%.
Image source: Wind
The "pig cycle" layout weapon - animal husbandry ETF (516670) closed down 0.14%, recording 8 consecutive yin, closing at 0.698 yuan, closing out of the long lower shadow.
Image source: Wind
The sector continued to weaken, but funds took advantage of related ETFs to actively deploy. Wind data shows that as of December 20, the livestock breeding ETF (516670) has received a net inflow of 9.24 million yuan in the past five trading days.
Image source: Wind
[Constituent stock information: part of the shares held by the controlling shareholder and actual controller of Aonong Biotech have been frozen]
On December 20, Aonong Biotech announced that its controlling shareholder, Zhangzhou Aonong Investment Co., Ltd., has recently frozen a total of 6 million shares.
At the same time, Aonong Biotech also disclosed the information that the shares held by the actual controller Wu Youlin were frozen/marked three times. Aonong Biotech said that Wu Youlin's shares that have been judicially frozen and judicially marked recently have accumulated about 45.85 million shares, accounting for 51.11% of his shares and 5.26% of the company's total share capital.
On December 12, Aonong Biotech announced that it had recently signed the "Strategic Cooperation Intent Agreement" with Dabeinong, and Aonong Investment and Dabeinong signed the "Investment Cooperation Intent Agreement".
"Taking into account the above matters such as the signing of the agreement of intent between Aonong Investment and Dabeinong, the proposed agreement to transfer shares of Aonong Investment and the judicial freezing of some shares of Aonong Investment and Wu Youlin, the subsequent situation of the company's shares held by Aonong Investment and Mr. Wu Youlin may face more changes and greater uncertainties, and relevant changes may lead to the risk of instability of control of the company. Aonong Biotech said.
[Industry observation: the number of live pigs slaughtered in November, the performance of pig prices in the pickled peak season is average]
According to the latest data from the feed industry information network, on December 20, 2023, the weighted daily average price of live pigs slaughtered in China was 14.83 yuan per kilogram, an increase of 0.28% from the previous day. Overall, pork prices have fallen into the all-time bottom zone, and have been in the low price range for most of this year.
Source: Wind, 2013.11.18-2023.12.20
On the supply side, in November, the main pig enterprises slaughtered a total of 13.31 million pigs, with a total of 13.31 million pigs slaughtered, a month-on-month growth rate of +8.7% and a year-on-year growth rate of 15%. On a month-on-month basis, Dabeinong and Jinxinong grew by more than 20% month-on-month, and only 3 listed pig companies saw a month-on-month decline in slaughter. On a year-on-year basis, only 2 listed pig companies saw a year-on-year decline in slaughter.
Source: China Merchants Securities
Haitong Securities believes that the current pickling season has entered, but the pig price is still average, reflecting that the current supply is still too much. The elimination of sick pigs brought about by the epidemic is still continuing to impact the market, and pig prices may not improve in the short term. Long-term losses may lead to the loss of cash flow of farmers, and the foundation for capacity reduction is solid.
From the perspective of the number of sows that can reproduce, at the end of October, the national number of sows that can reproduce was 42.1 million, -0.71% month-on-month, a month-on-month decline, but still 1.1 million heads higher than the normal number. With the long-term low operation of pig prices, it is expected that the reduction of pig production capacity is expected to accelerate.
Data source: Wind, 2015.1-2023.10
[Institutions: Capacity may be accelerated, pay attention to the layout opportunities in the current window period]
Changjiang Securities pointed out that the essence of the pig breeding industry is survival of the fittest, and high-cost breeding capacity may be phased out. At the current point in time, judging from the fitting of sow and piglet feed data, the overall supply of commercial pigs in the first half of next year may still be abundant, and the industry will continue to lose money for more than 1 year in this cycle. Both the cash flow of the industry and the length of the loss reflect that the aquaculture industry is experiencing the bottom of the clearing, the breeding capacity of the de-escalation or into the acceleration stage.
CICC believes that after the disclosure of the financial report in the first half of 2023, the average cash of listed pig enterprises is close to the bottom of the last cycle in the first half of 2018, and the asset-liability ratio of pig enterprises is at a historical high. Under the background of continued weak pig prices, the tension of the capital chain of the pig breeding industry may intensify, and the industry may return to the "cost competition" from the "capital competition", and the production capacity may accelerate the decentralization.
["Pig Cycle" Investment Weapon - Animal Husbandry ETF (516670)]
The CSI Animal Husbandry Index (930707.CSI) tracked by the Animal Husbandry ETF (516670) selects the stocks of listed companies involved in livestock and poultry feed, livestock and poultry drugs, and livestock and poultry breeding businesses from Shanghai and Shenzhen A-shares as sample stocks to reflect the overall performance of the stocks of listed companies related to animal husbandry. At present, there are 35 constituent stocks in the index, which fully cover the entire industry chain of animal husbandry and breeding, and focus on the layout of the core track of pig breeding. According to historical performance, the animal husbandry sector has shown obvious cyclicality for a long time according to the relationship between supply and demand, and there is a strong correlation between the overall and pig prices.
Data source: Wind, statistical period 2015.1.7-2023.12.6. Past performance is not indicative of future performance. Indices operate for a relatively short period of time and do not reflect all stages of market development.
OTC users can invest and subscribe through feeder funds (Class A 014414; Class C 014415).
Risk Warning: Funds are risky and should be cautious when investing. The above views, opinions and ideas are based on the current situation and are subject to change in the future. For the above views or information quoted from securities companies and other external institutions, we do not make any substantive guarantee or commitment to the authenticity, completeness and accuracy of such views and information. Past performance of a fund is not indicative of its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the performance of the fund. Investors should carefully read the "Fund Contract", "Prospectus", "Product Key Facts Statement" and other fund legal documents, fully understand the risk-return characteristics of fund products, and make independent decisions on fund investment and choose suitable fund products based on their own risk tolerance, investment period and investment objectives on the basis of understanding the product situation and listening to the suitability opinions of the sales agency.
The performance of the CSI Animal Husbandry Index in the past five years was -17.16% (2018), 75.7% (2019), 13.49% (2020), 5.93% (2021), and -13.21% (2022), respectively. The CSI Livestock Index is compiled and published by China Securities Index Company Limited. The Compiler of the Index will take all necessary measures to ensure the accuracy of the Index, but does not guarantee this and will not be liable to any person for any errors in the Index. Past performance of the Index is not indicative of future performance and does not constitute a guarantee of investment income or any investment advice. Indices operate for a relatively short period of time and do not reflect all stages of market development.