Feedlot break-evens will remain well above the 5-Area Direct Steer prices as we head toward the fourth quarter and lead to losses for unhedged cattle sold on the cash market. Sterling’s estimated losses for those cattle last week at -$323.68/head against -$307.19/head the prior week. The first cost going into the feedlot for cattle marketed last week was $376.17/cwt. with a feed cost of $399/head. This compares to cattle placed on feed last week with a feeder price of $347.24/cwt. with an estimated feed cost of $487/head. Feedlots are adjusting!
Packers lost some ground last week with Sterling’s estimated margin at $138.80/head against $177.16/head. The Comprehensive Cutout gained $2/cwt. to average $379.13/cwt. Higher-cost cattle purchased the prior week were slaughtered against that cutout.
View the full Sterling Beef Profit Tracker for the week ending Sept. 19.
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.)
