HK Stock Market Move | Muyuan Foods Group (02714) fell over 3% as pig prices are in a phase of fluctuating stabilization. Deferred pig supply and the fulfillment of second breeding may exacerbate supply pressure.

Muyuan Foods Group (02714) fell over 3%, dropping 3.6% to HK$31.62 as of the time of reporting, with a transaction value of HK$50.14 million. In terms of news, since mid-July, pig prices have entered a correction phase, fluctuating in a bottoming out stage after a decline from high levels. As of July 31, the national average selling price for external three-yuan live pigs was 10.28 per kilogram, down by 1.11 per kilogram from the peak in early July, a drop of 9.75%. Kaiyuan Securities believes that looking ahead, the short-term price gap for fat pigs is relatively strong, and small farmers holding back from selling may provide some support for pig prices. However, the deferred pig source from July, planned increases in scale farms for August, and the impending realization of previously raised pig sources will all limit the upward price potential. However, the central political bureau meeting in July expanded the relevant statements regarding the pig farming industry from the April meeting's "stabilize pig and Shenzhen Agricultural Power Group prices" to "stabilize pig production and prices." Guotou Securities believes this may indicate a shift in policy focus from "prices" to "production." The firm expects that under the dual pressure of policy guidance and market-based losses, pig farming capacity could accelerate in a non-linear manner. Considering that breeding sows have been undergoing significant and continuous reduction since Q2 2026, and that the capacity of sows takes about 10 months to marketable pigs, Q1 2027 could be a turning point for profitability in pig farming.