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Cattle and hog harvest rates were lower last week with higher cash prices paid to farmers and feeders. Margins for both beef and pork packers are trending lower.

Cattle feeding margins narrowed significantly last week while pork producer margins remain mired in red ink the first weeks of the new year.

Spiking wholesale beef prices the week before Christmas helped lift packer margins into the black while increasing cattle feeding margins.

Cattle feeders are finding modest profits on market-ready cattle early in the New Year, but replacement feeder cattle prices are driving projected breakevens to eight-year highs.

Packer margins remain in the red even as wholesale beef prices rallied $9 per cwt. and cash cattle prices were near steady.

Beef packers saw per head losses nearly double last week as wholesale beef prices tumbled $7 per cwt. lower. Pork processors are also found negative margins and producer margins remain short of breakeven.

Negative margins continue growing for beef packers as tightening supplies of cattle support cash prices $17 per cwt. higher than the same week a year ago.

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.

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