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Profit Tracker: Losing Steam

16:19PM Aug 26, 2014

Profitability for both cattle and hog producers has been losing steam for the past month, but things could be a lot worse. Cattle feeders recorded average profits of $162.67 per head last week, down more than $35 from the previous week, according to the Sterling Beef Profit Tracker. The margins represent a $222 per head improvement over the average losses of $59 recorded last year at this time, according to estimates developed by John Nalivka, president of Sterling Marketing, Vale, Ore.

Beef cutout values dropped almost $6 per cwt. last week, while beef packer margins saw an increase nearly $8 per head. A week ago packers were making just under $111 on every animal processed, and earnings totaled almost ten times worse at the same time last year when packers made $14.62 per head.

Farrow-to-finish hog margins dropped $21.42 per head this week. Negotiated cash hog prices fell $10 per cwt. to $99.72 per cwt. Pork packer margins saw a jump with profits of $11 per head, compared to a profit of $7.35 last week.

Cash prices for fed cattle are more than $30 per cwt. higher than last year, and negotiated hog prices are approximately $25 per cwt. higher than last year.