Dairy Industry

[winston]

Milk Seen Surging 15% on Drought-Feed Costs Before Demand Slows

Retail-milk prices will rise as much as 15 percent by the first quarter of 2013, after the worst U.S. drought since 1956 sent livestock-feed costs to a record, according to Dairy Management Inc., an industry group.


http://www.moneynews.com/Markets/Milk-p ... /id/460158

[winston]

not vested

Chinese Milk Powder Producers

Let's look at producers of baby milk powder, who are having a good run.

The three notable shares are Biostime (1112), Yashili International (1230) and Mengniu Dairy (2319).

The first two have reached new highs while Mengniu is approaching a three-year best and might soon clear resistance at HK$28.20. That could mean targeting the HK$34.30 level in 2007 before the tainting scandals.

To appreciate potential just look at the border and milk powder smugglers being stopped by authorities. Demand for milk powder that's trusted beats all.

The mainland is now hard at work on consumer confidence. Success will deliver huge benefits.

Mengniu seeks a lift in a venture with Danone, Yashili is setting up a powder plant in New Zealand, and Biostime has a French guarantee of supplies for three years.

We await results of the milk shake-out, but if all goes well the producers of powder could see sales not just double or triple but rise tenfold.

Source: Dr Check, The Standard HK

[winston]

Dairy industry faces supply dilemma

The milk shortage issue has been resolved recently in China but the country still faces the dilemma of either hardship to dairy farmers having to sell milk cheaply or end-users paying high prices.

The weekly fresh milk price began to drop last month, unlike in the second half of last year when weather and disease problems sparked a series of hikes, Xinhua News Agency quoted the Ministry of Agriculture as saying.

Shenzhen-based analyst Jian Aihua at sovereign fund China Investment Corporation said increasing production capacity in China has helped lower prices. "The price hikes of 2013 have led some dairy farmers to start expanding their scale of production, and results are being seen now."

Also, industry insiders have suggested the fall in demand after Lunar New Year, as well as increasing supply from countries such as New Zealand, are also behind the fall in price.

Yet, some industry insiders say volatility in the price of fresh milk over the past few years is unhealthy for the industry. A dairy farmer said manufacturers, who collect milk from farms, usually have more bargaining power over them and the consumers.

Shares of milk-related shares jumped a lot last year amid government's plan for industry consolidation. China Mengniu Dairy (2319) has jumped 83 percent from a year earlier to HK$39.80. The mainland's top liquid milk producer by volume also became a blue-chip company with its entry into the Hang Seng Index last month.

Yashili International (1230) surged nearly 40 percent to HK$4.05 compared to a year ago. However, China Huishan Dairy (6863) share price stayed around its September listing price, up just 0.4 percent in five months.


Source: The Standard HK

[behappyalways]

Milk money: Dairy prices on the rise
http://money.cnn.com/2014/06/09/investi ... d=HP_River

[winston]

<Research Report>Merrill Lynch: Mainland dairy sector decline overdone
Jun 25, 2014

BofA Merrill Lynch, in its latest research report, noted that the diary sector has declined 29% so far this year, and the correction has overdone, therefore a positive view is reiterated.

With Buy investment rating for the sector, the Bank maintained the target price for MENGNIU DAIRY (02319.HK) and CH MODERN D (01117.HK) at $45 and $4.8, respectively.

Meanwhile, BIOSTIME (01112.HK), affected by one-off non-cash item, is seeing weakened 1H performance, and the target price was cut from $59 to $56.

Source: AAStocks Financial News

[winston]

Dairy stocks pressured on central M&A proposal
Jun 13, 2014

The Ministry of Industry and Information Technology (MIIT)'s consumer goods unit convened a meeting today for promoting the acquisitions and reorganization of dairy companies which produce infant formula, and the reorganization plan of domestic infant formula industry has been approved by the central government, Nanfang Daily reported.

Certain aims were laid out, in the way that by 2015, about 10 infant formula enterprises will achieve annual revenue above RMB2 billion, and top 10 enterprises will account for 65% of market share; by 2018, 3-5 enterprises will achieve annual sales revenue above RMB5 billion, and top 10 enterprises will account for 80% of market share.

HK dairy stocks received the news negatively, as MENGNIU DAIRY (02319.HK) last lost 3% to $35.4; YASHILI INT'L (01230.HK) faded 4.2% to $2.93; BIOSTIME (01112.HK) and CH MODERN D (01117.HK) dropped 3% and 3.7%, respectively. YST DAIRY (01431.HK) continued lower by 0.7%; HUISHAN DAIRY (06863.HK), despite in-line results, decreased 1% to $1.91.

Source: AAStocks Financial News

[winston]

<Research Report>UBS latest ratings & target prices for CN dairy stocks (Table)
July 14, 2014

In a research report, UBS updated the latest investment ratings and target prices for Chinese dairy stocks.

Stock / Investment Rating / Target Price (HK$)
CH MODERN D (01117.HK) / Buy / $4.87->4.17
MENGNIU DAIRY (02319.HK) / Buy->Neutral / $43.1->40.45
HUISHAN DAIRY (06863.HK) / Neutral / $2.23->2.04
YASHILI INT'L (01230.HK) / Sell / $2.7
WANT WANT CHINA (00151.HK) / Sell / $9.36->8.82


Source: AAStocks Financial News

[winston]

by investar:-

From VC Morning:

Net profit of China Modern Dairy (1117.HK) more than doubled in 1H14, thanks to higher unit price of raw milk and increase in production volume. Meanwhile, China Shengmu (1432.HK) also posted a decent set of interim results with its earnings up 171.5% yoy.

Operating environment of mainland raw milk producers has improved in the wake of the industrial streamlining.

China Modern Dairy (1117.HK)
 Trading outlook has turned positive after breaking away from upper band of a descending channel.
 Turnover volume increased sharply in recent sessions.
 HKD4/share is a psychological resistance.

Huishan Dairy (6863.HK)
 Has been hovering at low levels between HKD1.6- 2.0/share since May14.
 Appeared to have found a firm support at HKD1.8/share.
 But turnover has remained thin. Investment funds are apparently not flowing in the stock.

YST Dairy (1431.HK)
• Has bounced back gradually after having built a support at HKD1.21/share.
• Increase in turnover is a good sign.
• Initial resistance lies at HKD1.43/share or the 10-day MA.

[winston]

by behappyalways

China: Hebei Farmers Dumping Milk They Can't Sell as Industry Adjusts
http://english.caixin.com/2015-01-07/100771888.html

[behappyalways]

Dairy crisis: farmers facing ‘blow after blow’ as milk becomes cheaper than water
http://www.telegraph.co.uk/finance/news ... water.html