HK Stock Market Move | Dairy stocks lead gains; institutions say dairy cow destocking is expected to accelerate, and raw milk prices may be at an upward inflection point.

Dairy stocks lead gains. As of press time, MENGNIU DAIRY(02319) rose 4.22% to HK$18.29; CH MODERN D(01117) rose 4.14% to HK$1.51; YOURAN DAIRY(09858) rose 3.51% to HK$3.985; CHINA FEIHE(06186) rose 2.06% to HK$2.72. On the news front, according to statistics from the Ministry of Agriculture and Rural Affairs, as of September 24, the average price of raw milk in major domestic producing areas was 3.09 yuan/kg, up 0.32% week-on-week and up 1.64% year-on-year. At the current raw milk price, the industry is generally in a cash loss state. With the subsequent rise in meat prices stimulating culling, production capacity is expected to accelerate its reduction, and the subsequent capacity reduction will involve large-scale capacity. Raw milk prices are expected to usher in an upward inflection point. EB SECURITIES pointed out that the earlier expansion of upstream dairy farming, combined with weak post-pandemic downstream demand, led to a supply-demand gap that drove raw milk prices down continuously. Since 2025, with the continued culling of cattle and stable demand, raw milk prices have fluctuated at the bottom. Entering 2026, beef cattle prices have risen further, inventory reduction continues, and raw milk prices have shown signs of recovery. Moreover, during this round of reduction, leading farms have stronger risk resistance, while small and medium-sized farms have been gradually eliminated, increasing industry concentration.