Tisco Securities raised its rating on Thailand’s food sector from neutral to overweight, citing expectations of a sharp earnings rebound in the second half of 2026 after the industry hit cyclical lows earlier in the year.
The upgrade reflects improving fundamentals across key protein segments, particularly livestock, where prices have begun to recover following sharp declines in the second quarter. Tisco’s top stock selections in the sector are CPF, TFG and BTG, based on projected margin expansion and volume recovery.
Analysts anticipate a sustained rebound in Thai chicken and pork prices, supported by tightening supply that may take 12 to 18 months to normalize. Chicken export orders remain robust, aided by the European Union’s ongoing restrictions on Brazilian poultry imports, which have diverted demand toward Thai suppliers. Feed costs are also easing as corn prices retreat from recent peaks.
External demand is stabilizing, with pork prices in China and Vietnam showing signs of recovery due to government supply-control measures. Livestock prices began to firm in July and August, while corn costs have trended lower, easing pressure on producers’ margins.
The sector’s net profit fell 58% year-over-year to 6.9 billion baht in the second quarter of 2026, while revenue declined 2% to 200 billion baht. The profit decline was driven by a 31% year-over-year drop in pork prices, softer chicken prices and elevated feed costs, with corn prices up 8% over the same period. Weakness in Chinese and Vietnamese pork markets during the first half of 2026 further weighed on results.
