Dairy stocks rose broadly across A-shares and HK stocks; we expect this to be driven by cyclical catalysts and capital flows.

English summary

### Dairy stocks rose broadly across A-shares and HK stocks; we expect this to be jointly driven by cyclical catalysts and capital flows. Time: 2026-07-30 11:30:03 Content: On the one hand, the upside in the raw milk cycle is relatively certain: 1. Supply side: loose milk prices are rising, and H2 2026 is highly likely to enter the right side of the raw milk cycle. Since May, the impact of foot-and-mouth disease has gradually faded; dairy cow inventories continue to decline; and the current summer season with frequent heat stress in dairy cows jointly constrains supply. From August to October, the upstream enters another silage season, which is expected to further promote de-stocking. 2. Demand side: Since 2026, liquid milk demand has stabilized and recovered. Although Q2 mass consumer goods sell-through declined sequentially, from a marginal perspective, June liquid milk sell-through accelerated compared with April-May, and the full-year prosperity is expected to be better than last year. Meanwhile, dairy companies' deep-processing capacity is ramping up, increasing milk consumption. The cyclical reversal directly benefits upstream farms and also promotes downstream structure and profitability improvements. …