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Cattle feeders experience largest average profits in seven years as packer margins dip into the red.

Profit margins for cattle feeders and packers continue pacing in opposite directions as shrinking supplies of market-ready cattle drive negotiated cash prices higher.

Cattle feeders sold more cattle last week than any week this year and at the highest price in history. Pork producers saw modest profits.

Cattle feeders saw their margins shrink $70 per head last week as a modest increase in market-ready supplies led packers to sharply cut their negotiated purchases.

Wholesale beef prices continue to support packer margins even as negotiated cash cattle trade well-above the five-year average. Pork producers enjoy a market rally that has lifted margins out of the red.

If a seasonal price decline develops as anticipated, this year’s starting point for cattle feeders is the best in a decade. Pork producers notch their second week of modest profits.

During a bilateral meeting on Thursday, U.S. Trade Representative Katherine Tai discussed with Mexico’s Secretary of Economy Tatiana Clouthier various issues concerning energy and biotech corn.

Erik Lichtenberg, University of Maryland professor, says Congress could reorient farm bill conservation funds for climate change, but it could cut into their support.

“Pork producers need the freedom to operate without worrying about excessive government regulation tripping them up, and that’s exactly what this bill will do,” says Rep. Zach Nunn (R-Iowa).

This year, U.S. pork exports to Chile have rebounded, increasing 30% through April year over year, reports the U.S. Meat Export Federation, fueled by retail and foodservice features.