HK Stock Market Move | Muyuan Foods (02714) falls more than 4% in the afternoon, pork prices hit a near six-year low, institutions predict that the clearance of production capacity is expected to accelerate.

Muyuan Foods (02714) fell more than 4% in the afternoon, falling 3.8% as of press time to HK$45.6 with a turnover of HK$1.23 billion. In terms of news, pork prices have been falling since the Spring Festival. As of March 13, the national average price of pigs was 10.09 yuan/kg, hitting the lowest point since January 2019, with Guangxi, Northeast China and other provinces falling below the 10 yuan/kg mark. In March, the NDRC and the Ministry of Agriculture convened a special meeting of leading pig farming companies focusing on comprehensive regulation of pig production capacity. Huatai analysis believes that with the continuous cash flow consumption of the industry, the depletion of production capacity is expected to accelerate. Reviewing the production capacity digestion market of the 2023 pig cycle, the sector's stock prices often start when pig prices accelerate, and after pig prices start to fall rapidly, piglet prices accelerate, which is an important catalyst for the market in the first half of the current production capacity digestion phase, and the sector's current position is relatively low.