Profit Tracker: Feedyard Margins Trend Higher

Cattle feeding margins improved $57 per head last week, due primarily to lower prices paid for incoming feeder cattle against last week’s marketings. ( Wyatt Bechtel )

Cattle feeding margins improved $57 per head last week, due primarily to lower prices paid for incoming feeder cattle against last week’s marketings. Industry average profit margins on cattle sold last week were $184 per head, according to the Sterling Beef Profit Tracker.

For the week ending April 26, cash cattle sold for an average of $126.24 per cwt., while the beef cutout closed the week at $231.52  up $0.72 from April 19. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

A year ago cattle feeders were earning an average of $74 per head. Feeder cattle represent 73% of the cost of finishing a steer compared with 72% a year ago.

Farrow-to-finish pork producers saw their margins improve $5 per head with profits of $48 per head. Lean carcass prices traded at $83.49 per cwt., $2.50 per cwt. higher than the previous week, and $6.89 higher than a month ago. A year ago pork producer margins were positive $7 per head. 

Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2019 will average $153 per cow. That would be modestly lower compared to the $162 estimated average profit for 2018. Estimated average cow-calf margins were $164 in 2017, $176 in 2016, and $438 per cow in 2015.

For feedyards, Nalivka projects an average profit of $74 per head in 2019, which would be $50 better than the average of $24 per head in 2018. 

For farrow-to-finish pork producers, Nalivka projects average profits of $26 per head in 2019, as compared with an average profit of $1.35 per head in 2018. 

 
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