Guangda Futures: Egg front-month contract hits the limit up, beware of risks of high-level pullbacks

From a fundamental perspective, the demand for eggs in terminal sales areas varies, with most traders buying in accordance with demand. Prices in most markets are stable, with a few experiencing a decrease. Short-term stocking before the Dragon Boat Festival may still provide support for spot prices. However, as egg prices rise, the sentiment of farmers to cull chickens is increasing, with a limited decrease in the number of laying hens. As a result, there may be expectations of an increase in egg supply in the future. Additionally, as the southern regions gradually enter the rainy season, the spot egg prices will be affected by traders' cautious stocking, with a high likelihood of seasonal decline. Therefore, the egg futures prices are currently at relatively high levels, and may maintain a high level of volatility in the short term, with attention to the risk of a high-level pullback. Future focus should be on the impact of increased farming profits on stocking and slaughter intentions on the supply side.