Packers again saw black ink last week with Sterling’s estimated kill and cut margin at $34/head. As I have indicated, last week’s estimate used the prior week’s cattle cost ($230.56/cwt).
However, if this week’s early weakness in the Cutout persists through the entire week, coupled with an $8/cwt. gain in the 5-Area Choice steer price last week, packer margins will once again fall into the red this week.
Feedlot margins gained nearly $100 per head last week with the gain in Choice steer prices pushing toward $737/head against an estimated breakeven price of $186/cwt.
View the full Sterling Beef Profit Tracker for the week ending July 12.
The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Ore.
(Note: The Sterling Beef Profit Tracker calculates an average beef cutout value for the week in its estimates for feedyard and packer margins. Other prices in the weekly Profit Tracker also are calculated weekly averages. Feedyard margins are calculated on a cash basis only with no adjustment for risk management practices. The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs. Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)
