Trading strategy: short JD1901
Logic: 1. The price of eliminated chickens keeps rising, and the number of old chickens waiting to be sold in the market is relatively small. The number of laying hens in the short term will gradually increase;
2. Before and after the Mid Autumn Festival, supplementary young chickens began to produce one after another, impacting spot prices;
3. The current basis has been at a low position in the same period, and the spot price is not sufficiently motivated to rise, so the future price may fall significantly.
Risk tip: The number of young chickens on hand is less than expected, and the large-scale spread of African swine fever is good egg Consumption.
1、 Short JD1901
（1） There are many chickens eliminated in the early stage, but the current number of laying hens is low
It can be seen from the price trend of eliminated chickens that more old chickens were eliminated before and after the Mid Autumn Festival, making the price of eliminated chickens near the Mid Autumn Festival relatively low. Due to the large number of old chickens eliminated in the early stage, the number of chickens to be cleaned is relatively small, and the chicken age structure is dominated by two or three hundred day laying hens. The number of chickens to be eliminated in the future is small, and the number of laying hens will gradually increase in the short term.
Figure 1: Currently, there are fewer chickens to be cleaned
Data source: Wind CITIC Futures Research Department
Figure 2: Current number of laying hens
Data source: Zhihua Data CITIC Futures Research Department
（2） Downstream consumption is gradually warming up
After a batch of old chickens are eliminated around the Mid Autumn Festival, they will be added to the fence immediately. In terms of the price of laying hens, there was a large amount of supplement during the Mid Autumn Festival. After 60 days, the young chickens for supplement began to produce. 1 The corresponding time point was late this month, which had an impact on the spot price.
Figure 3: Egg spot price trend
Data source: Wind CITIC Futures Research Department
Figure 4: The price of laying hens shows that there are many fill columns in the Mid Autumn Festival
Data source: Zhihua Data CITIC Futures Research Department
（3） Basis is in a relatively reasonable range
Referring to the average price of 4.02 yuan/jin in the national egg production area on November 19, the current basis is about negative 300. Considering that the delivery cost is between 200 and 300, the futures price corresponding to the current spot price in theory is lower than the current JD1901 price, and the current basis is at a low level in the same period of history, so shorting the JD1901 contract is operable from the basis.
2、 Risk factors
1. The number of supplementary young chickens is less than expected
2. Large scale spread of African swine fever benefits egg consumption
CITIC Futures Team 2
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Editor in charge: Song Peng
