Feedlot, packer margins continue climb out of the red

In the last three weeks, feedlot margins have improved by more than $111 per head. Unfortunately, three strong weeks of gains have not been enough to turn per-head losses into gains as feeder losses averaged $97.57 per head the first week of April, according to the Sterling Beef Profit Tracker.  

One factor behind the improving feedlot margins have been the steadily improving fed cattle price. The 5-area direct price improved more than $1.60 per hundredweight last week, reaching $167.41. Feeder cattle were also higher last week, with 750 to 800 pound placements averaging $215.79, up from $215.63 per hundredweight the previous week. Against this week's marketings, feeder prices were down $3, averaging $236.04 per hundredweight. Breakeven prices for placements were up 50-cents last week to $162.80 per hundredweight. Against this week's marketings, breakeven prices were down, averaging $174.92.  

Packer margins improved $15 per head last week to negative $40.31 per head. The beef cutout value climbed more than $5 last week to $253.37, up from $248 the previous week.

Farrow-to-finish margins dropped last week, falling to negative $21.23 per head, compared to negative $16.97 per head, according to the Sterling Pork Profit Tracker. Lean hogs were up slightly, reaching $58.57 per hundredweight, compared to $58.46 the previous week.

Pork packer margins fell more than $4 last week, averaging $2.27 per head compared to $6.82 the previous week. The pork cutout value finished the week at $64.98 per hundredweight, down from $67.02 the previous week.

The Sterling Beef Profit Tracker for the week ending April 4:

  • Average feeder margins: -$97.57 per head.
  • Average beef packer margins: -$40.31 per head.

The Sterling Pork Profit Tracker for the week ending April 3:

  • Average farrow-to-finish margins: -$21.23 per head.
  • Average pork packer margins: $2.27 per head.

The Sterling Beef and Pork Profit Trackers are produced by Sterling Marketing Inc. and John Nalivka, president, Vale, Ore., and are published weekly by Drovers/CattleNetwork, and PorkNetwork.