Egg Weekly: Off-Season Meets Bottom-Fishing, Production Area Prices Rebound(Oct 22)

Egg Weekly: Off-Season Meets Bottom-Fishing, Production Area Prices Rebound

Domestic Egg Market Analysis

This week, domestic egg market quotes showed a V-shaped trend. As of Thursday this week, the average price of brown eggs was 3.83 yuan/jin, down 0.06 yuan/jin from last week, and the average price of pink eggs was 3.91 yuan/jin, down 0.17 yuan/jin from last week. Both brown and pink egg prices maintained their downward trend, with a price spread of 0.08 yuan/jin between the two. The market is currently in the off-season for demand, with food factories and supermarkets showing no centralized stockpiling activity. Downstream traders mainly purchased on a just-need basis, and the demand side overall lacked significant bullish drivers. However, trading in low-price areas improved notably, with more traders bottom-fishing for inventory, and market sentiment warmed up somewhat. Production area prices stopped falling and rebounded, with the short-term trend showing a stable-to-firmer bias.

1.2 Egg Market Price Trend Charts

Layer Flock Inventory and Slaughter Analysis

2.1 Inventory Analysis

Looking at total inventory, the farming side is currently in a marginally profitable state with limited profit margins. Large farms mostly followed established plans to steadily advance restocking, with a relatively stable pace. However, small and medium individual farmers were concerned about future market conditions, with a strong wait-and-see sentiment, moderate restocking willingness, and low enthusiasm for capacity expansion. Overall, restocking sentiment on the farming side showed clear divergence, and the short-term restocking pace is likely to remain stable without significant volume increases.

Egg Demand Analysis

On the demand side, the market is in the traditional off-season. Food factories and supermarkets showed no centralized procurement activity, and downstream traders primarily purchased on a just-need basis. However, as prices in some areas fell to relatively low levels, bottom-fishing demand emerged, with traders increasing inventory purchases at low prices, which provided some support to production area prices.

Egg Market Outlook

Looking ahead, the market is in the demand off-season, and overall demand lacks significant bullish drivers. However, low-price bottom-fishing activity has provided some support to prices. In the short term, production area prices are expected to show a stable-to-firmer trend, with limited downside room. Restocking sentiment on the farming side is divergent, and significant capacity changes are unlikely in the near term. Prices are expected to fluctuate within a range, with a modestly firm bias supported by low-price procurement activity.