Profit Tracker: Feeding Margins Plummet

September 1, 2015 11:25 AM

Cattle feeding losses nearly doubled last week as cash fed cattle prices declined another $2 per cwt. Feedyard closeouts recorded average losses of $221.04 per head last week, $94 more than the previous week, according to calculations by Sterling Marketing, Vale, Ore. Choice steer prices dipped to $145.29 per cwt.

Beef packers saw their margins reach an average of $101 per head, up from $82 profits the previous week.  The beef cutout declined $2 per cwt. to $145.29.

A month ago cattle feeders were losing $68 per head, while a year ago profits were pegged at $172 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 $13 for every animal processed, while a year ago packers were earning $80, Sterling Marketing estimates.

Farrow-to-finish pork producers showed a profit margin of $20 per hog last week, a decline of $5 per head from the  previous week and down $8 from a month ago.

Pork packers saw their margins remain steady at $11 per head. Negotiated prices for lean hogs were $75.63 per cwt. last week, down $2.61 per cwt. from the previous week.

Cash prices for fed cattle are $10 per cwt. lower than last year, and negotiated hog prices are $19 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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