Profit Tracker: Feedyard Losses Exceed $200 Per Head

April 28, 2015 10:10 AM
Profit Tracker: Feedyard Losses Exceed $200 Per Head

Cattle feeding margins took another tumble last week after a $1 per cwt. decline in fed cattle prices. Cattle feeders lost an average of $207 per head, about $17 more than losses recorded the previous week.

The 5-area direct cash cattle price declined $1 per cwt. to $159.58. That was well below the average breakeven price of $175.50, according to the Sterling Beef Profit Tracker. A year ago cattle feeders were earning $180 on every animal sold.

Beef cutout prices traded nearly equal to the previous week at $257.50, and packer margins improved more than $30 per head, resulting in average profits of $65 on every animal processed.

Farrow-to-finish pork margins improved about $2.50 per head, producing losses of $8.14 per head. Both beef and pork profit margins are calculated by Sterling Marketing, Vale, Ore.

The cost of feeder cattle factored against last week’s live cattle sales was up only slightly compared to the previous week. Feeder cattle represent more than 80% of the total cost for finishing a steer, up significantly from last year when feeder cattle represented 73% of that total cost.

A month ago beef packers were losing $55 on every animal processed, while a year ago packers were earning $24, Sterling Marketing estimates. Pork packers saw their margins improve $2 per head, with losses of about $4 per head. Cash prices for fed cattle are $13 per cwt. higher than last year, and negotiated hog prices are $51 per cwt. lower than last year.

Nalivka projects average cash profit margins for cow-calf producers at $541 per cow this year. Last year’s estimated average cow-calf margins were $548 per cow. 

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