Profit Tracker: Markets, Margins Steady

Profit Tracker: Markets, Margins Steady

Cattle feeders earned an average of $17 per head on cattle shipped to market last week, a gain of about $7 per head from the previous week. Cash cattle markets held relatively steady at $111 per cwt., while total costs of feeding a steer dipped $37 per head, according to the Sterling Beef Profit Tracker.

Beef packers saw their margins slip $6 per head, but held on to very strong positive margins of $158 per head. Last week’s beef cutout price was $197, up $1 from the previous week.

Break even prices for steers sold last week averaged $109.68 per cwt., also steady with the previous week. However, cattle placed on feed last week have a projected breakeven of $115.47 per cwt. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

The cost of finishing a steer last week was calculated at $1,527 per head, which is $37 less than the $1,564 a year ago. A month ago cattle feeders were earning $27 per head, while a year ago losses were calculated at $199 per head. Feeder cattle represent 74% of the cost of finishing a steer, compared to 74% last year.

Farrow-to-finish pork producers earned an average of $11 per head last week, with lean carcass prices at $64.39, fully $4 higher than the previous week. A year ago pork producers lost an average of $39 per head. Pork packer margins totaled $13 per head last week, about $12 per head lower than the previous week.

Cash prices for fed cattle are $13 higher than the same week a year ago. Lean hog prices are about $16 per cwt. higher than last year.

Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2017 will average $131 per cow. That would be $46 per head less than the estimated average profit of $177 for 2016. Estimated average cow-calf margins were $438 per cow in 2015.

For feedyards, Nalivka projects an average profit of $210 per head in 2017, which compares favorably with average losses of $4.25 per head in 2016. Nalivka expects packer margins to average about $120 per head in 2017, up from $114 in 2016.

For farrow-to-finish pork producers, Nalivka projects 2017 profit margins to average $15 per head, compared to $5 per head last year. Pork packers are projected to earn $26 per head in 2017, up slightly from $24 profit per head in 2016.

 

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