The six-week long rally in fed cattle prices pulled feeding margins to within $20 of breakeven last week. Negotiated cash cattle prices averaged $105.46, and closeouts the second week in August saw an average loss of $19.98 per head, according to the Sterling Beef Profit Tracker. A month ago losses averaged more than $213.
Packer margins were estimated at $296 per head, about $10 more than the previous week. The Choice beef cutout price averaged $208.05 per cwt., about $5 higher than the previous week. Feedyard margins reported by the Sterling Profit Tracker are calculated on a cash basis only with no adjustment for risk management practices.
A year ago cattle feeders saw cash losses of $28 per head on closeouts the second week of August, while packers saw profits of $350. (Note: The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs.)
Feeder cattle represent 73% of the cost of finishing a steer compared to 71% a year ago. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.
Farrow-to-finish pork producers saw their margins hold nearly steady with $36 per head losses. Lean carcass prices traded at $39.34 per cwt., down $4.97 per cwt. A year ago pork producers earned $28 per head profit. Pork packers saw average profits of $60 per head, about $11 per head higher than the previous week.
(Editor’s note: Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)
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