What is the impact of the implementation of the no resistance order on the industrial chain in July?

category:Finance
 What is the impact of the implementation of the no resistance order on the industrial chain in July?


Feed enterprises may have a long-term layout

It is undeniable that the correct and reasonable use of antibiotics plays a very important role in the treatment and prevention of animal infectious diseases and other diseases, especially in large-scale breeding, feed antibiotics have significant advantages. However, according to the document of the Ministry of agriculture and rural areas, China is one of the countries that use antibiotics most in the world. In recent years, the use of antibiotics inclines to animal use obviously. The abuse of antibiotics may bring serious consequences such as drug-resistant bacteria, teratogenesis, cancer and so on. Since 1986, many countries in the European Union have banned all growth promoting antibiotics one after another, and after the prohibition, there is no obvious problem of high incidence of disease and production decline. It is an inevitable choice for the development of the industry to promote the prohibition of feed antibiotics, which will reduce the use of antibiotics in the breeding industry and help to maintain the safety of animal derived food and public health in China.

Will the adjustment of feed drug use increase the production cost of enterprises? How will it affect the feed industry?

The use of antibiotics in feed is prohibited, the industry will seek some substitutes, or it will have a certain impact on the cost of feed production, but the impact is not significant. As the leader of domestic feed industry, the relevant person in charge of Dabei agriculture recently told the securities times u00b7 e company in an interview that the rational use of antibiotics in feed will provide more safe food for the end consumer protection, which is a beneficial development trend for consumers. At the same time, for large-scale feed enterprises, the problem of illegal abuse of antibiotics by some local small feed enterprises will be regulated, the market environment will be further optimized, and the industry concentration will be accelerated, which is a good measure. As the industry leader, the advantages of Dabei agricultural industry chain are obvious. Even if the cost is increased, there is no problem in the downstream transmission.

The reporter is concerned that the market has long expected the implementation of this Anti Japanese policy, and relevant enterprises have done a good job in adjusting the layout.

Since 2015, the former Ministry of agriculture has banned 8 kinds of veterinary antibiotics for food animals and 1 kind of veterinary antibiotics for animal growth promotion in three years. According to Announcement No. 2638 of the Ministry of agriculture and rural areas, since May 1, 2019, China has stopped operating and using raw materials and preparations of three kinds of veterinary drugs, including olaquindox, aminoarsonic acid and roxarsone. After the implementation of the anti drug ban order, the remaining 11 veterinary antibiotic products will also be withdrawn. However, if the animals are ill, they can still be treated with other drugs normally.

As for the implementation of the anti drug policy on July 1, the above-mentioned responsible person of Dabei Agriculture said that the feed anti drug company had done a good job in layout and research and development before, and would not have a significant impact on production later. The preparations must have been made in advance. The person said.

As for the investors questions about the companys response to the anti drug prohibition measures, the Secretary of the board of directors of tianbang Co., Ltd. recently replied on the interactive platform that the companys feed anti drug program technology reserves for many years, and the project key technology and application of feed antibiotic substitution for pig healthy breeding participated by the company won the second prize of national science and technology progress in 2019.

What is the impact of downstream aquaculture?

For the breeding industry in the downstream of feed industry, animal growth, especially the prevention and control of epidemic diseases in large-scale farms, will undoubtedly face some challenges.

There must be some influence on pig industry. Now the problem of adding antibiotics to pig feed is widespread, because there is still African swine fever, and the immunity of pigs is relatively poor, so adding antibiotics is also to improve the survival rate of pigs. If not added, it is certainly beneficial from the perspective of food safety, but from the perspective of breeding, it may improve the difficulty of enterprise breeding. Zhang Lili, an analyst of Zhuo Chuang pig industry, said in an interview with the securities times u00b7 e company that although there are other substitutes for antibiotics, there must be a gap in the effect, so it will have a certain impact on the industry in a short time. However, the change of feed composition will also have a habit process, which will not have a significant impact on the pig industry as a whole.

Zhang Lili said that even if the cost of feed is increased, the range will not be obvious, and the short-term impact is mainly reflected in the immunity of pigs. At present, the price of live pigs is generally stable with a downward trend. Although there may be a boost to the price of pigs due to busy farming and Dragon Boat Festival in June, the price may fall in July. Recently, novel coronavirus pneumonia has a significant impact on imported meat, but it has little impact on the whole industry. The test of frozen products tends to be strict, or good for pig price formation.

Antibiotics do have a therapeutic effect. Without adding antibiotics, if the enterprises feeding biosafety system is well done and has a certain degree of prevention and control ability for the disease itself, then banning antibiotics this time will put forward higher requirements for the enterprises breeding level, but for some small enterprises with poor management level, it may reduce the survival rate. A person from an unnamed listed company in the A-share market told the reporter of securities times u00b7 e company that many small-scale farms are unwilling to spend their energy to do a good job in farm management, so they are able to prevent the emergence and spread of diseases by using a large number of antibiotics and other drugs. Under the policy of prohibition of resistance, it puts forward higher requirements for pig breeding, or it will promote pig production capacity to further incline to enterprises with high management level and strong core competitiveness. As for the leading enterprises in the industry, it is also an international practice to deal with the policy in advance, so the impact on enterprises will not be particularly large.

Antibiotic substitutes have become popular

At the same time, the Ministry of agriculture and rural areas has also organized a team to launch the work of formulation of feed substitution standard, and organized relevant experts and enterprises from colleges and universities and scientific research institutes across the country to participate in the preparation of technical guide for substitution of feed antibiotics, aiming to provide several sets of optional and operable feed substitution schemes for various animal farmers. In the A-share market, the concept of antibiotic substitutes has become popular.

According to the recent research report of Everbright Securities, the commonly used functional additives for feed substitute mainly include enzyme preparation, acidifier and plant essential oil to improve palatability. Among them, enzyme preparation can improve digestibility and utilization efficiency of feed, probiotics can maintain intestinal balance and integrity. Acidifiers can reduce the pH value of gastrointestinal tract, improve the activity of digestive enzymes, and maintain the intestinal health of animals, mainly including organic acids, including formic acid, acetic acid, propionic acid, butyric acid, lactic acid, citric acid, fumaric acid, etc.

Jindan technology, which just landed on GEM in April 2020, is a high-tech enterprise that uses modern biotechnology to produce large-scale industrial L-lactate and its derivatives. Since June, the companys share price has risen nearly 60%.

When Jindan technology recently accepted the investigation of investors, it said that it was forbidden to add antibiotics in feed processing since July this year. At present, the products that replace antibiotics include Chinese herbal extracts, plant essential oil, Lactobacillus, and also acidizers that are mainly lactic acid. Domestic animal husbandry now pursues efficiency. Relatively speaking, acidizers have quick effect and low cost, from the second half of last year to At present, the demand for lactic acid in feed industry is increasing rapidly.

The company also said that due to the limited use of feed antibiotics, the compound acidifier with lactic acid as a component will grow rapidly in feed due to its low comprehensive cost and obvious substitution effect; under the background of rapid growth in the demand for polylactic acid, lactic acid as the most important raw material of polylactic acid will grow rapidly.

In addition, according to Everbright Securities Research Report, cholesterol is the key raw material of vitamin D3, mainly extracted from lanolin and animal brain stem. Because of the risk of spreading diseases, brain stem and spinal cord are not allowed to be used as raw materials in European and American countries. The main companies producing lanolin cholesterol are domestic garden biology, NFC of Japan, dishman of India and NK of Singapore (limited production). The national standard of vitamin D3 oil, a feed additive, stipulates that the starting material of vitamin D3 oil is lanolin cholesterol, which limits the use of brain stem cholesterol. The raw material is limited, the supply of vitamin D3 shrinks, and the price is expected to rise. Or affected by the above factors, since the end of May, the share price of vitamin D3 industry enterprises, including Huayuan biology, XinHeCheng and Zhejiang medicine, has shown a more volatile upward trend. Source: responsible editor of Securities Times: Yang Bin_ NF4368

In addition, according to Everbright Securities Research Report, cholesterol is the key raw material of vitamin D3, mainly extracted from lanolin and animal brain stem. Because of the risk of spreading diseases, brain stem and spinal cord are not allowed to be used as raw materials in European and American countries. The main companies producing lanolin cholesterol are domestic garden biology, NFC of Japan, dishman of India and NK of Singapore (limited production). The national standard of vitamin D3 oil, a feed additive, stipulates that the starting material of vitamin D3 oil is lanolin cholesterol, which limits the use of brain stem cholesterol. The raw material is limited, the supply of vitamin D3 shrinks, and the price is expected to rise.

Or affected by the above factors, since the end of May, the share price of vitamin D3 industry enterprises, including Huayuan biology, XinHeCheng and Zhejiang medicine, has shown a more volatile upward trend.