Poultry producers are cashing in as China's swine fever crisis shows no sign of abating, sending prices of chicken soaring. Shares of breeders, meanwhile, have skyrocketed.
Prices of white-feathered chicken have jumped by almost 50%, Dutch bank Rabobank told CNBC. They were hovering around 7.5 yuan (about $1.08) per kg for the past two years, but peaked to around 11 yuan per kg in May this year, according to the firm, which pointed out that it broke the previous record high.
While prices moderated in June, analysts expect poultry costs to rise for the rest of this year, with pork shortages set to continue due to African swine fever that has swept across China and killed millions of pigs.
Rory Green, an economist at TS Lombard, told CNBC that chicken prices will follow pork prices upward in the second half of this year.
"Poultry is now considered the safe option as health concerns mount over (African swine fever) contagion, further boosting demand," he told CNBC in an email.
The pig herd in China, the world's biggest pork producer, was estimated to have shrunk by 40% from a year ago, according to Rabobank estimates. The bank said on Tuesday the hog population could halve by the end of 2019.
As diners turn to other alternatives, prices for other meats such as fish, lamb and beef have also shot up in the country, according to Green. Lamb prices have risen 11% year-over-year to 56 yuan per kg, while beef prices have gone up 6% in the same period to 57 yuan per kg.
But poultry is the big winner, boosting stocks of companies and even benefiting exporting countries.
"We expect China to continue to import large amount(s) of poultry cuts in the coming months," Chenjun Pan, senior analyst at Rabobank, told CNBC. "Directly and indirectly, global poultry prices will be strongly supported by the rising trade volumes."
Meanwhile, stocks of chicken producers, which are listed in Shenzhen, have also risen.
Shares of China's biggest poultry and pork producer Wens Foodstuffs Group were up more than 50% so far this year, while those of chicken breeder, Shandong Xiantan, have surged 87%. Another chicken producer, Shandong Minhe Animal Husbandry, soared more than 200%.
Overall, Shenzhen Stock Exchange's agriculture index has gained around 59% year-to-date.
Soybeans might also be another beneficiary. Demand for the oilseed — used as feed for hogs — had been hurt by falling pig populations amid the swine fever outbreak.
But with farmers raising more chickens, it could revive the demand for soybeans in China, which is the world's largest consumer of the feed.
"A large portion of the pig herd being culled has a negative impact on soybean meal demand. But it's been suggested that increased feeding of poultry and aquaculture helped partially offset this decline," financial services company INTL FCStone said in a report this month.