Cattle feeding margins declined $9 per head last week, leaving average cash margins at $58. Despite cash prices $1 lower at $114, packer margins were mostly steady at $219, according to the Sterling Beef Profit Tracker.
The beef cutout was steady at $214.63 per cwt., roughly 30 cents better than the previous week. The cost of finishing a steer last week was calculated at $1,506, which is $81 lower than the $1,587 a year ago. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.
A year ago cattle feeders were earning $103 per head. Feeder cattle represent 73% of the cost of finishing a steer compared with 75% a year ago.
Farrow-to-finish pork producers saw their margins decline from breakeven the previous week to a loss of $6 per head. Lean carcass prices traded at $57.30 per cwt., $3.15 per cwt. lower than the previous week, and $5.06 lower than a month ago. A year ago pork producers earned an average of $4 per head. Pork packer margins averaged a profit of $23 per head last week.
Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2018 will average $165 per cow. That would be steady compared to the $164 estimated average profit for 2017. Estimated average cow-calf margins were $176 in 2016, and $438 per cow in 2015.
For feedyards, Nalivka projects an average profit of $22 per head in 2018, which would be $159 less than the average of $181 per head in 2017. Nalivka expects packer margins to average about $165 per head in 2018, up from $120 in 2017.
For farrow-to-finish pork producers, Nalivka projects 2018 profit margins will average a loss of $3 per head in 2018, compared to profits of $21 in 2017. Pork packers are projected to earn $19 per head in 2018, down from $25 profit per head in 2017.