Feeding margins were down in the face of a $7/head drop in the 5-Area Direct Steer prices last week. For the week, slaughter steer prices averaged $248/cwt. compared to $255.22/cwt. the prior week.
In addition, break-evens are on the rise with substantially higher feeder cattle prices. Sterling’s estimated breakeven for cattle placed on feed last was $248/cwt. compared to $228/cwt. for cattle marketed last week.
The average price of 750 to 800 lb. feeder steers last week was $378.65 against $327.83 a year ago. Although the packer’s cost of cattle was down last week, the Comprehensive Cutout was also lower averaging $384.56/cwt. compared to $392.24/cwt. the prior week leaving Sterling’s estimated packer margin at -$311.12/head and marginally deeper into red ink last week from the prior week.
View the full Sterling Beef Profit Tracker for the week ending July 11.
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.)
