HK Stock Market Move | Muyuan Foods Group (02714) rose by over 8%, with live pigs returning to a price of 10 yuan. Industry capacity adjustment policies have clearly accelerated.

Muyuan Foods Group (02714) rose more than 8%, rising 8.13% to HK$31.4 at the time of publication, with a turnover of HK$152 million. In terms of news, monitoring data from China's pig farming website shows that on July 1st, the price of live pigs (lean hogs) was 10.14 yuan/kg, the first time it has returned to the "10 yuan era" since April 26th. In addition, the policy of regulating pig production capacity has accelerated significantly. Since June, the Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission have held consecutive meetings on capacity regulation, for the first time making "four leading" rigid requirements for large-scale breeding enterprises, and specifying a hard deadline of the end of September to complete the reduction of production capacity and the elimination of inefficient sows. Galaxy Securities pointed out that they continue to focus on the rhythm of the pig cycle operation. Based on the value of breeding sows and breeding efficiency, the pig price has been declining year-on-year for 26 years, and there may be some rebound performance during the period. Taking into account the acceleration of capacity reduction brought about by policies and the increase in industry losses, they focus on high-quality pig enterprises with significant changes in cost margins and good funding conditions.