The dog days of summer are nowhere to be found with profits continuing to increase for both cattle and hog producers. Cattle feeders recorded average profits of $280.08 per head last week, up significantly from the previous week, according to the Sterling Beef Profit Tracker. The margins represent a $442 per head improvement over the average losses of $162 recorded last year at this time, according to estimates developed by John Nalivka, president of Sterling Marketing, Vale, Ore.
Beef cutout values increased $6 per cwt. last week, while beef packer margins saw a big swing increasing by $31.95 to a margin of $81.07 per head. A week ago packers were making just $49.12 on every animal processed, and earnings totaled a little less at $73.15 per head the same time last year.
Farrow-to-finish hog margins increased $10.20 per head to more than $101 per head. Negotiated cash hog prices rallied almost $6 per cwt. to $127.22 per cwt. Pork packer margins saw a down turn with losses of $0.18 per head, compared to a profit of $3.87 last week.
The continued rise in both cattle feeding and farrow-to-finish profits is due to significantly higher cash prices and lower overall feed prices. Cash prices for fed cattle are nearly $35 per cwt. higher than last year, and negotiated hog prices are approximately $25 per cwt. higher than last year.
Cow-calf producers have also seen a drastic change in profit margins compared to the past few years. Currently producers are averaging $480 in profit per cow, that’s nearly double the $243.05 made last year and more promising than the $153.60 margin reported in 2011.