Cattle feeders finally found profitability last week after cattle markets posted a $6 to $7 per cwt. rally.
The Sterling Beef Profit Tracker estimates feedyard profits totaled $150 on every animal shipped last week as average cash prices edged above $133 per cwt. with average breakevens of $122.30. Last week’s closeouts were $180 better than the previous week.
USDA’s 5-area cash cattle price two weeks ago was $123.76, with average breakevens of $129.07.
Feeder cattle prices averaged $160.65 per cwt. against the fed cattle sold last week, according to John Nalivka, Sterling Marketing, Vale, Ore. The total cost of finishing cattle marketed last week was $1,701 per head, $94 per head lower than the previous week.
Beef packer margins improved $2 per head, with profits now at $50 per animal. Packer margins were about $16 lower than a month ago.
A year ago cattle feeders were losing $79 per head, according to Sterling Marketing. Feeder cattle represent 73% of the cost of finishing a steer, compared with 78.5% a year ago.
A month ago beef packers were earning $66 for every animal processed, while a year ago packers were earning $65 per head, Sterling Marketing estimates.
Farrow-to-finish pork producers found profits of $31 per hog last week, up about $5 per head from the previous week, and up $20 per head over the past three weeks.
Pork packer margins were $5 per head lower for a $2 profit per hog. Negotiated prices for lean hogs were $76.34, about $2 per cwt. higher than the previous week. Cash prices for fed cattle are $27 per cwt. lower than last year, and negotiated hog prices are $6 per cwt. lower than last year.
Sterling Marketing projects 2016 average cash profit margins for cow-calf producers at $177 per cow. Last year’s estimated average cow-calf margins were $432 per cow. Cow-calf profits for 2014 were estimated at $517 per cow.
