Profit Tracker: Cattle Margins Improving
Momentum continues to build for cattle feeders as closeouts saw average profits increasing during the final week of 2021. Estimated fed cattle margins totaled $189 per head, according to the Sterling Beef Profit Tracker, a gain of $48 per head from the previous week.
Beef packer margins were estimated at $329 per head, a decline of $11 from the previous week, and down $183 per head from the first week of December.
Cash cattle prices the last week of December averaged $139.97 per cwt., $4.05 higher than the previous week, and $28.49 higher than the final week of 2020. The Choice beef cutout price was $264.34 per cwt., $3.94 per cwt. lower than the previous week.
The packer/feeder cash margin spread for the week ending Dec. 31, 2021 was $140.06 per head in favor of packers, which was $101 lower than a month prior.
A year ago cattle feeders found cash profits of $43 per head on closeouts the last week in December, while packers saw profits of $229. (Note: The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs.)
Feeder cattle represent 67% of the cost of finishing a steer. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.
Farrow-to-finish pork producers saw average losses of $27 per head last week, a $2 improvement over the previous week. Lean carcass prices traded at $63.34 per cwt., $0.23 per cwt. higher than the previous week. A year ago pork producers lost $8 per head. Pork packers saw average profits of $44 per head, about steady with the previous week.
(Editor’s note: Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)
