Sep 15, 2014
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Profit Tracker: Significant Rise

August 1, 2014
By: Wyatt Bechtel, Dairy Today google + 
BT Rotator Feedlot 12
Profit margins for cattle feeders rose significantly in the past week.  

Profit margins for cattle feeders rose significantly in the past week, while pork producers saw a slight decrease from their still profitable farrow to finish operations.

Cattle feeders recorded average profits of $357.58 per head last week, more than $77 per head higher than the previous week, according to the Sterling Beef Profit Tracker. The margins represent a $506 per head improvement over the average losses of $148.49 recorded last year at this time, according to estimates developed by John Nalivka, president of Sterling Marketing, Vale, Ore.

Beef cutout values were up $4.12 per cwt. last week, and beef packer margins increased $3.40 per head to end the week with proits of $71.50 per head. A month ago packers saw profits of $80.89 on every animal processed, and gains totaled just $17.69 per head at the same time last year.

Farrow-to-finish hog margins declined $9.09 per head but profits remain more than $102 per head. That is nearly an $85 difference from last year when pork producers saw only a $17.59 profit. Negotiated cash hog prices declined $4.13 per cwt. to $128.01 per cwt. Pork packers were estimated to make $5.26 for every animal processed.

The spike in both cattle feeding and farrow-to-finish profits this summer is due to significantly higher cash prices and lower overall feed prices. Cash prices for fed cattle are more than $44 per cwt. higher than last year, and negotiated hog prices are nearly $27 per cwt. higher than last year.

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