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Profit Tracker: Cattle Feeding Margins Bounce Higher

13:50PM Jan 14, 2015
Bunk Feedlot

Cattle feeding margins jumped $43 per head higher last week on sharply higher cash cattle sales. Live cattle sales averaged $4 per hundredweight higher last week with relatively steady total feeding costs, according to the Sterling Beef Profit Tracker. A month ago feeders were losing an average of $32 per head, while a year ago profits totaled $123 per head.

The 5-area Direct cash price last week was $169.62, while the cost of feeder cattle factored into last week’s Profit Tracker was $1 per head higher than the previous week. Feeder cattle represent nearly 80% of the total cost for finishing a steer, up significantly from last year when feeder cattle represented 68% of that total cost.

Farrow-to-finish pork margins fell $3 per head last week, closing with a per head profit of $6. Both beef and pork profit margins are calculated by Sterling Marketing, Vale, Ore.

Beef packers saw their margins decline $7 per head, with losses now at more than $57 per  head, Sterling Marketing estimates. Those losses are $13 per head more than last year’s average losses of $44 per head. The beef cutout was up $5 at $250.69 per cwt.

Pork packers saw their margins decline about $3 per head, with profits now at $6 per head.

Cash prices for fed cattle are $29 per cwt. higher than last year, and negotiated hog prices are $2 per cwt. lower than last year.

Nalivka projects average cash profit margins for cow-calf producers at $743 per cow this year. Last year’s estimated average cow-calf margins were $556 per cow.