Profit Tracker: Feeding Losses Under $50

August 10, 2015 11:47 PM

A $4 per cwt. rally in cash fed cattle prices reduced losses for fed cattle to less than $50 per head last week. The $46 per head average losses last week marked a $22 per head improvement over the previous week, according to calculations by Sterling Marketing, Vale, Ore. Choice steer prices averaged $151.83 per cwt., a $4.30 per cwt. advance.

Beef packers saw their margins drop $18 per head from a $12 profit per head to a $6 loss.

Closeouts were hampered by a near $5 per cwt. gain in the price of feeder cattle calculated against last week’s marketings. Packer margins were aided by a $1.50 per cwt. gain in the beef cutout.

A month ago cattle feeders were losing $108 per head, while a year ago profits were pegged at $284 per head, according to Sterling Marketing. Feeder cattle represent 78 % of the cost of finishing a steer, still significantly higher than last year’s 73%.

A month ago beef packers were earning $35 on every animal processed, while a year ago packers were earning $108, Sterling Marketing estimates.

Farrow-to-finish pork producers showed a profit margin of $21.57 per hog last week, up $1 from the  previous week and down $3 from a month ago.

Pork packers saw their margins improve $6 per head to a $12 per head profit. Negotiated prices for lean hogs were $77.48 per cwt. last week, down 17 cents per cwt. from the previous week.

Cash prices for fed cattle are $9 per cwt. lower than last year, and negotiated hog prices are $46 per cwt. lower than last year.

Nalivka projects average cash profit margins for cow-calf producers at $606 per cow this year. Last year’s estimated average cow-calf margins were $548 per cow. Cow-calf profits for 2016 are projected at $490 per cow.

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