Profit Tracker: Steady In The Red
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.