"Seesaw" turns into "Systemic Surge" Is the main upward wave in the agricultural sector coming?

This week (March 2-6), the agriculture (farming, forestry, animal husbandry, and fishery) sector experienced a dramatic turn: as two major sub-sectors—pork and seed industry—fluctuated in the first four trading days, they ultimately surged across the board.

Specifically, according to Tongdaxin data: the pork index from March 2-5 showed three consecutive days of rising and pulling back, followed by a sharp decline on the fourth day, with respective changes of -1.61%, -0.47%, -0.17%, and -1.11%. Meanwhile, the seed industry index initially rose by 2.07% and 2.63%, then surged by 5.81%, before suddenly dropping 8.22%.

However, on March 6, these two major sub-sectors jointly launched a strong rally. By the close, the seed industry index had increased by 3.24%, and the pork index by 3.93%.

Other sub-sectors also performed notably. The indices for aquatic products, grains, and chicken rose by 2.14%, 3.45%, and 3.76%, respectively, with gains not far from those of pork and seed sectors. Overall, the “Agriculture, Forestry, Animal Husbandry, and Fishery Index” for the entire sector closed up by 3.94%.

So, what caused the agriculture sector to shift from “big divergence” to “big unity”? Is the main upward wave really arriving?

“Currently, there are positive factors supporting the agriculture sector’s rise, but the conditions for a main upward wave are still not mature,” said Li Weixia, an economist at Fuding Asset Management. He believes the fundamental reason for the sector’s rollercoaster in the first four days is that grains are raw materials for breeding, creating a “see-saw effect” between the seed industry and pork sectors. The balanced rally on Friday is a self-regulation within the sector.

However, if we say the agriculture sector has begun a main upward wave, it’s still quite challenging, mainly due to several technical aspects:

1. The pork index broke below support on Thursday in a low-volume state, with the break occurring on daily and weekly charts. This indicates a lack of active bottom-fishing, meaning the large-volume rally on Friday was a common chasing behavior, and there’s no need for a pullback next week. Additionally, the 120-week moving average for pork is not only trending downward but also accelerating, which is a drag for the bulls.

2. The seed industry’s Thursday performance saw a large gap down at the open, trapping funds from Wednesday, but closed by swallowing Tuesday’s positive candle. The big rally on Friday only partially filled Thursday’s gap within half an hour, then stalled, making the subsequent three hours of chasing riskier next week.

3. Regarding the entire sector, the Agriculture, Forestry, Animal Husbandry, and Fishery Index on Friday broke through the highs of December 30, 2025, January 30, 2025, and March 3, 2025, but this breakout lacked a gap, rendering it invalid. Another detail is that the volume during the continuous decline since September 2025 has been lower than this week’s volume, yet the index failed to break the September 2025 high, indicating further dispersion of chips. Moreover, historical experience shows that if a downward trend is broken without surpassing the previous high, a sharp decline often follows.

4. Most critically, the strongest phase of the agriculture sector’s rise often coincides with the bottoming of major A-share indices. If a resonant low point aligns with the start of a new industry cycle, the gains in agricultural stocks can be quite strong. Currently, this condition is not met.

Therefore, next week, the agriculture sector is expected to mainly undergo a correction with some structural opportunities. Investors should pay close attention to the detailed February CPI data and consider technical signals to decide whether to take short-term positions.

(Source: Shangyou News)