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Cattle feeding margins slipped further into the red last week on soft cash prices, while packer margins climbed to extreme heights.

Pork producer margins dropped $15 per head last week due to a $7.59 per cwt. decline in lean carcass prices.

Last week’s $2 rally in cash cattle prices helped narrow the spread between feedyard losses and packer profits.

Improvements in feedlot margins were ever so slight last week due to a $1 gain in cash fed cattle prices. Pork producers saw a $5 per head improvement.

The combination of shrinking packer profits and smaller feedyard losses over the past six weeks has reduced the packer/feeder margin spread by 27%, according to the Sterling Beef Profit Tracker.

Steady improvements in feedayrd margins the past month coupled with declining packer margins has narrowed the spread nearly 50% since late August.

The packer/feeder profit margins spread, historically large a month ago, has shrunk by 50% with gradually improving live cattle prices.

Both cattle and hog feeding enterprises continue showing modest losses while packers remain solidly profitable.

Average feedyard close-outs were printed in black ink last week for the first time in several months after a $3 per cwt. rally in cash cattle prices.

Last week’s $1 increase in cash fed cattle prices did little for feedyard profits, but the $6.40 rally in wholesale beef prices added another $25 onto already large packer margins.