Understanding the Market | Livestock Stocks Rise Collectively, Short-term Factors Do Not Affect the Resonance of the Meat and Dairy Long Cycle, Dairy and Meat Linked Model Enterprises Show Outstanding Profitability
Livestock stocks rose collectively, with YOURAN DAIRY up 6.71% and CH MODERN D up 4.2%. CITIC Securities pointed out that the short-term slowdown in the reduction of dairy cow inventory is affecting stock prices, but the cyclical logic remains unchanged, and the resonance between meat and milk is still present. It is expected that raw milk prices will bottom out and rebound, and beef prices may reach a turning point. It is recommended to pay attention to companies such as YOURAN DAIRY and China Shengmu
According to the Zhitong Finance APP, livestock stocks have collectively risen. As of the time of publication, YOURAN DAIRY (09858) is up 6.71%, trading at HKD 3.34; CH MODERN D (01117) is up 4.2%, trading at HKD 1.24; Original Ecology Livestock (01431) is up 1.82%, trading at HKD 0.28; and China Shengmu (01432) is up 1.45%, trading at HKD 0.35.
CITIC Construction Investment released a research report stating that in the short term, the overall stock prices of livestock-related targets have adjusted due to a slowdown in the reduction of dairy cow inventory over the past two months. However, short-term factors will not impact the cyclical logic itself, and the logic of the meat and milk resonance under the cattle cycle remains unchanged. Looking ahead, with the seasonal weakening of demand and the continued increase in operational pressure on related ranch operators, the reduction trend of dairy cow inventory will continue, and the turning point for the raw milk cycle is approaching.
Tianfeng Securities previously stated that the current reduction of dairy cow capacity may be nearing its end. The funding pressure from Q3 silage purchases may accelerate the clearing of margins, and raw milk prices are expected to bottom out and rebound; beef prices may reach a turning point, but due to multiple factors such as funding, confidence, and environmental protection, the enthusiasm for restocking may be affected, and the subsequent increase and sustainability may exceed expectations. Companies with cow resources or those adopting the "milk-meat linkage" model will have more prominent profitability. It is recommended to pay attention to YOURAN DAIRY, China Shengmu, Bright Meat Industry, CH MODERN D, and Australia Asia Group, among others
