Understanding the Market | YOURAN DAIRY rises over 4%, institutions say the logic of meat and milk resonance remains unchanged in the cattle cycle

YOURAN DAIRY rose over 4%, as of the time of writing, up 4.61%, priced at HKD 3.18, with a trading volume of HKD 82.6843 million. In terms of news, CITIC Construction Investment Securities pointed out that in the short term, due to seasonal recovery in demand and reduced production caused by heat stress in dairy cows, the rate of dairy cow inventory reduction has slowed in the past two months. However, short-term factors will not impact the cyclical logic itself, and the resonance logic of meat and milk under the cattle cycle remains unchanged. The pullback under short-term data shocks has instead become a very good timing for positioning in this round of major cyclical speculative opportunities. Looking ahead, with the seasonal weakening of demand and the continuous increase in operational pressure on related ranches, the dairy cow inventory will still maintain a trend of reduction, and the turning point for the raw milk cycle is approaching. Guosheng Securities believes that milk prices are expected to emerge from the downward cycle, leading to opportunities in the livestock and dairy industries. The firm expects that this round of milk prices is entering the end of the downward cycle, and with the acceleration of inventory reduction, a turning point is expected to be welcomed. However, against the backdrop of an increasing proportion of large-scale ranches, the fluctuations in milk prices will be significantly smoothed. For livestock companies, the narrowing decline in milk prices and the reduction of losses from culling cows will lead to profit recovery on the financial statements