A：Yes, from a cyclical perspective, the farming industry has indeed reached a relative bottom with a high allocation value. The sector has performed with the market rebound in the last two weeks, and the overall allocation value is still high.

A：The aquaculture industry has a unique positioning in the-share market. It has a low correlation with the market and follows its own fundamental changes more. Compared with other plates, it has a low correlation with other styles and can be regarded as a sixth style, which is relatively independent in the process of deduction.

A：The pig cycle refers to the time period from the sow pregnancy to the complete process of commercial pig fattening for sale, which takes about ten months. This biological attribute determines that changes in the supply of sows will affect the supply of commercial pigs in the market ten months later, resulting in large market price fluctuations and greater uncertainty.

A：The supply of pork depends on two key variables: the number of sows that can be bred, I .e., the number of sows that can produce piglets; and the efficiency of farming, I .e., the number of piglets that can be produced per sow that can be bred. In addition, the weight of pork is also a controllable factor, which will affect the change of supply to a certain extent. In the pig cycle, the number of sows that can be bred is a key variable in determining supply, and its fluctuations can have a significant impact on the overall market. As an important factor of medium and long-term supply, breeding efficiency can affect supply, but its change speed is relatively slow, which is not as direct and significant as the change of sow number.

A：Pork consumption is a relatively rigid part of the Chinese diet, and even though pork consumption may gradually decline in the future with changes in population structure and eating habits, this is a longer-term trend and does not significantly affect the current market supply and demand situation.

A：Judging from the situation in the last one or two years, the consumption of pork is relatively stable, and the fluctuation between years is very small. Even in the peak season of pork consumption such as the New Year, the holidays will rise, but in the off-season will remain relatively stable, the overall consumption throughout the year is more uniform, the volatility is not large, so in the pig cycle supply framework is not the core contradiction, the main focus on the supply situation.

A：The pig cycle is a simple cyclical model of the economic cycle, with a cycle of about 10 months. When pork prices rise, farming profits increase, farmers will profit and start to fill the column, that is, increase the number of sows, and these new sows will lead to an increase in the supply of pigs after ten months. But as supply increases, prices fall and farming profits fall, creating a negative feedback mechanism. In addition, if the supply is reduced and the price increases are large, the farmers will reduce the sow replenishment or even not breeding, which will lead to future supply contraction, prices rise again, so that the cycle is the whole pig cycle running process. It is known that there are four complete pig cycles in history, each of which is affected by some exogenous variables, such as the forced contraction of supply due to the outbreak of blue ear disease in the first cycle; the highly pathogenic swine flu epidemic in the second cycle; the third cycle is due to the national environmental protection demolition, which restricts pig breeding; the fourth cycle is the emergence of African swine fever, this pig cycle is particularly complex and volatile, and long-lasting, with multiple outbreak disturbances and large fluctuations in pork prices.

A：The current round of pig cycle began with African swine fever, which is characterized by a reduction in volatility compared to the past, and due to the sharp fluctuations in the early cycles and market learning effects, the structure of farmers has changed, and large-scale farming has gradually become the mainstream trend. The data shows that in the past few cycles, the replenishment or removal of listed companies has always been higher than the industry average, and the market share has continued to rise. By comparing the data of the industry as a whole and other subjects, it is clear that large-scale farming has changed the supply structure and rhythm of the pork market.

A：We calculate the average of the year based on the level of supply ten months ago, for example, in 21 years, we refer to the data from February to December of 20 years, and reflect the overall number of commercial pork pigs in that year by calculating the average of the supply of these months. First of all, according to the supply of sows (mother pigs), multiplied by a sow can produce piglets coefficient, to get the supply of pork, and then multiplied by the weight to get pork production.

A：Since 2022, pork production as a whole has increased every year except for a small decline in 2024. This growth of 30 per cent in 2021 and about 5 per cent a year thereafter, indicating an increasingly abundant supply.

A：Scale farms have gradually occupied a dominant position. According to the latest data, their market share in the breeding industry has reached 70%, and retail investors only account for 30%. The scale field has better breeding technology and higher breeding efficiency, can better withstand the cycle down, and insist on operating when the market price is low, waiting for future profits.

A：With the increase of scale plants, the supply of pork market increases, which puts greater pressure on CPI. Pork has a high weight in the CPI, and price fluctuations directly affect changes in the core weight of the CPI. As the supply of large-scale factories increased, pork prices gradually declined, which in turn had a contractionary effect on the overall CPI.

A：There are two common buying and selling points for investment in the pig farming sector: first, the expected stock price stage, that is, to observe the current reduction in the stock of sows, to predict the next 10 months after the supply of pigs to reduce, ahead of the layout.

A：The first strategy is low in buying points, but may be too early to be accurately judged; the second strategy reacts quickly and can catch the main upsurge, but may face the problem that the increase has been effectively reacted to by the market. We are currently in the phase of anticipating an increase in pig prices and have not yet seen a substantial increase in pig prices.

A：When the entire farming industry is generally losing money, it is a better time to lay out the farming business. By analyzing the relationship between the breeding index (agriculture, forestry, animal husbandry and fishing index) and the profits of the breeding entity (e. g., the profits of breeding pigs and self-breeding pigs), it is possible to invest at the right point in time in order to obtain excess returns when market conditions change.

A：A better time to invest usually occurs when key indicators are zero or negative, especially in pig cycle analysis, when farming profits are below zero, meaning that the market is losing money, but may be a better time to invest. The current space is gradually shrinking, with the evolution of the cycle, the early space is larger, but to 21 years after the two superimposed pig cycle, the supply increased, although the efficiency of breeding is improving, but the overall pork supply is still growing. At the same time, large-scale farms have a strong ability to control costs and can maintain profits by reducing costs when pig prices go down, and profits remain strong even when pork prices continue to fall.

A：Since September last year, the industry has been losing money for several months, which in history often indicates a clear bottom signal. To achieve good investment value in the future, the key condition is that farming profits need to continue to go negative to promote supply contraction. The current risk is that if losses are not large enough or long enough, supply fails to achieve a substantial contraction, which may lead to a reduction in price volatility during this cycle.

A：The current fundamental catalysis mainly comes from two aspects: first, the loss from September last year led to the de-production of production capacity; second, policy control, pork as an important species of people's livelihood, policy strength directly affects the degree of supply contraction. At present, while losses and policy regulation affect supply to some extent, they have not yet reached a level sufficient to catalyze market conditions with certainty.

A：The current supply of pork is very abundant, which is based on the combined effect of the number of sows, the number of pigs and the efficiency of breeding ten months ago. The number of breeding sows is still at a high level and is rising month-on-month, and the number of newborn pigs has continued to grow until this year. In addition, the increase in the amount of pig feed further evidence of adequate supply. However, the future supply situation also needs to pay attention to the impact of exogenous variables, such as the occurrence of epidemics and policy changes.

A：We predict forward supply mainly by observing the current number of breeding sows. According to the latest data, the number of sows that can be bred at the end of January declined month-on-month and has been declining for some time, indicating that rural equity debt is decreasing. According to data from the Ministry of Agriculture and Rural Affairs, the number of breeding sows has declined for nine consecutive months, and the number of newly born pigs in March has also declined year-on-year. This is the first time in 17 months, proving that the effect of capacity reduction has initially appeared.

A：According to the data, the weight of the whole March is still in a high position, and there has not been a downward trend, which is also relatively high in the same period of history.

A：Secondary fattening is an important indicator of speculative sentiment, and the phenomenon is currently actively underway, indicating that pig prices may rise in the future. As secondary fattening can greatly shorten the growth cycle of pigs, this will lead to a certain degree of rebound in short-term pig prices.

A：On the policy side, the government has continued to make efforts since last year, with the goal of reducing energy, weight and stabilizing prices. From the beginning of the fourth quarter, the policy effect gradually appeared, pig prices are relatively stable. This year still faces the problem of high supply of pork last year, but as the policy advances, the supply market will change.

A：Environmental protection policies have been restarted for many years, and regulators have begun to pay attention to and constrain the expansion of the Group's assets and liabilities, including controlling the number of breeding sows and eliminating frail pigs to improve breeding efficiency and promote high-quality development of the industry.

A：Foot-and-mouth disease outbreak is a recent exogenous variable, although currently mainly concentrated in cattle, but because of its strong infectivity and may lead to reduced pork consumption, pig production capacity and other factors, may affect the pace of pork market supply. However, due to the lack of vaccine prevention and the uncertainty of the progress of the epidemic, its specific impact is difficult to accurately assess.

A：The choice to invest in the farming sector through ETFs is due to the fact that ETFs (e. g. 159865) can cover the entire stock of pig farming, broiler farming and other entities, and the top ten constituents are basically large companies related to farming in A- shares, especially the main target of policy regulation-large-scale farms. Since the ETF tracking index is weighted by market capitalization, ETFs are a very suitable investment tool under the logic of investing in head companies in the current market. There is great uncertainty about when the aquaculture sector will rise and is currently in the left investment position. The core indicator that needs attention is whether the pig price can continue at a low level and may be maintained at a loss for 3 to 6 months, which will open up the forward investment space and may prompt the sector to start suddenly. The left side of the investment is mainly ambush-based, with the pig price low operation, the overall industry future investment certainty increased, the probability of ambush cash will also increase.

A：In the breeding ETF, the content of pig farming is as high as 40%, and even some companies' main business is pig farming. If the related businesses of these companies are added together, the total content of pig farming may be close to or exceed 60%, which is a very pure index product with pig farming as the core.

A：After the large-scale breeding is pushed out, the players who can make money in the market are mainly head farms, and they will get better profits with the increase of investment. In this cycle, the growth of the piggy farm will be falsified due to its weak ability to resist risks and is difficult to survive in the long-cycle grinding process. Therefore, under the logic of focusing on head companies, it is more appropriate to invest in ETFs.

A：Although the price of raw materials has risen, the head breeding companies have strong cost control capabilities, and their costs have not increased significantly, and some have even dropped slightly. Unless the price of raw materials rises sharply, it will not significantly weaken the profit margins of farming enterprises. Even if the price increase of pork is limited, the flexibility of performance can still be fully reflected.

A：The rise and fall of pork prices is mainly determined by supply, and demand only affects prices in negative circumstances, such as reduced consumption due to epidemics. When there is more supply, prices fall, and when supply contracts, prices rise, which is a price mechanism determined by market supply and demand.