Sep 30, 2014
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Profit Tracker: Lower Beef, Pork Margins

April 7, 2014
By: Greg Henderson, Beef Today Editorial Director
Feedlot Mexican Steers

Profit margins for both beef and pork producers fell slightly last week, yet both sectors remain solidly profitable.

Cattle feeders recorded average profits of $223 per head last week, about $19 per head lower than the previous week, according to the Sterling Beef Profit Tracker. The margins represent a $252 per head improvement over the average losses of $29 recorded last year at this time, according to estimates developed by John Nalivka, president of Sterling Marketing, Vale, Ore.

Beef cutout values declined $8.70 per cwt. last week, and beef packer margins declined $68 per head to end the week with losses of $36 per head. A month ago packers saw profits of $8 on every animal processed, and losses totaled $49 per head at the same time last year.

Farrow-to-finish hog margins declined $5.59 per head but profits remain more than $111 per head. The previous week recorded the highest pork profit margins in the Sterling Pork Profit Tracker database. Negotiated cash hog prices declined $0.35 per cwt. to $129.38 per cwt. Pork packers were estimated to lose $2.35 for every animal processed.

The spike in both cattle feeding and farrow-to-finish profits this spring is due to significantly higher cash prices and lower overall feed prices. Cash prices for fed cattle are more than $23 per cwt. higher than last year, and negotiated hog prices are nearly $50 per cwt. higher than last year.

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