Profit Tracker: Steady In The Red

Cattle and hog feeding
Cattle and hog feeding
(FJ)

Cattle and hog feeding margins were little changed last week, with both reporting modest losses. Average feedyard closeouts saw $17 per head losses for cattlemen, steady with the previous week, according to the Sterling Beef Profit Tracker. Industry-wide average cash cattle prices were mostly steady at about $109 per cwt. last week.

Average per head feed costs rose about $10 per head, which was offset by a modest decline in the price of feeder cattle in the calculations. The total cost for finishing a steer marketed last week was $1,497, about $14 more than the same week a year ago.  Cash cattle prices were $15 per cwt. higher a year ago and produced profits of about $209 per head the third full week of January 2020. This year feeder cattle represent 66% of the cost of finishing a steer compared with 72% a year ago.

Beef packer margins posted $97 per head gains to a weekly average of $304 per head. Packer margins the same week a year ago were $80 per head. Improving packer margins corresponds with a $9 per cwt. gain in wholesale beef prices to $218, which is down about 9% from the $238 per cwt. reported the week ending Dec. 4. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

Farrow-to-finish pork producers saw their margins steady at a $3 per head loss. Lean carcass prices traded at $57.13 per cwt.  $55.88 per cwt., $1.25 higher than the previous week, and $3.88 lower than a month ago. A year ago pork producers lost an average of $11 per head. Pork packer margins averaged a profit of $39 per head last week, about $5 per head less than the previous week.

Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2021 will average $123 per cow. For feedyards, Nalivka projects an average profit of $43 per head in 2021, and packer margins are projected to average $251 per head.

For farrow-to-finish pork producers, Nalivka projects 2021 will produces losses of $13 per head. Pork packers are projected to earn $37 per head in 2021.

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Fed Cattle Steady As Futures Hit 11-Month High

 

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