Profit Tracker: Feeder, Packer Margins Steady

Cattle feeding and packer profit margins were mostly steady the week ending December 21, with cash prices for fed cattle slightly higher. ( Wyatt Bechtel )

Cattle feeding and packer profit margins were mostly steady the week ending December 21, with cash prices for fed cattle slightly higher. Cattle feeders saw average profits of $31 per head, down les than $1 from the previous week. Packer margins averaged $141 per head, an increase of $4 per head, according to the Sterling Beef Profit Tracker. Cash cattle prices were $119, about 70 cents per cwt. higher.

The beef cutout was nearly steady at $211.62. The cost of finishing a steer last week was calculated at $1,600, which is $10 higher than the previous week and $5 higher than the same week a year ago. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

A year ago cattle feeders were earning an average of $48 per head. Feeder cattle represent 71% of the cost of finishing a steer compared with 73% a year ago.

Farrow-to-finish pork producers saw their margins slip $1 to average losses of $27 per head. Lean carcass prices traded at $46.71 per cwt., $1.53 per cwt. lower than the previous week, and $6.45 lower than a month ago. A year ago pork producer margins were at breakeven. Pork packer margins averaged a profit of $43 per head last week.

Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2018 will average $162 per cow. That would be steady compared to the $164 estimated average profit for 2017. Estimated average cow-calf margins were $176 in 2016, and $438 per cow in 2015.

For feedyards, Nalivka projects an average profit of $21 per head in 2018, which would be $160 less than the average of $181 per head in 2017. Nalivka expects packer margins to average about $168 per head in 2018, up from $120 in 2017.

For farrow-to-finish pork producers, Nalivka projects 2018 profit margins will average a profit of $2.50 per head in 2018, compared to profits of $21 in 2017. Pork packers are projected to earn $19 per head in 2018, down from $25 profit per head in 2017.

Related articles:

Profit Tracker: Feeder, Packer Margins Slip

Shortened Kills Slow Cash Market

 
Comments