Profit Tracker: Feedyard Margins Hit Triple Digits
Cash fed cattle prices averaged $2.62 per cwt. higher the week ending Sept. 18, boosting average cattle feeding margins to $109 per head, according to the Sterling Beef Profit Tracker. Feedyard closeouts the prior week averaged a $5 per head profit, while one year ago cattle feeders saw losses of $164 per head.
With average cash prices at $103.71, beef packer margins slipped back $44 per head, yet packer margins remain at $380 per head. Last week’s beef cutout price averaged $214 per cwt., a decline of about $6 per cwt.
Feeder steer prices against last week’s marketings averaged $118 per cwt., a significant advantage over cattle marketed a year ago when feeder cattle input prices were $145 per cwt. That’s roughly a $200 swing in the price of the feeder steers.
Feedyard margins reported by the Sterling Profit Tracker, by Sterling Marketing, Vale, Ore., are calculated on a cash basis only with no adjustment for risk management practices.
(Note: The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs.)
Sterling Marketing projects 2020 feedyard margins to average a $13 profit per head, while annual packer profits are projected at $307 per head. Cash cow-calf margins for 2020 are projected at $61 per calf.
Farrow-to-finish pork producers have seen their margins steadily improve over the past month with rising lean carcass prices. Last week saw average closeouts post $18 per head profits, about $20 per head better than the previous week, and $49 per head better than a month ago.
Lean hog carcass prices traded at $63.82 per cwt., $9.70 per cwt. higher than the previous week. Lean carcass prices are $22.42 higher than a month ago, and $16.72 higher than the same week a year ago. A year ago pork producers lost an average of $28 per head.
Pork packers saw average profits of $35 per head last week, about $13 per head less than the previous week.
Sterling Marketing projects 2020 annual per head losses for pork producers at $22 per head, while projected packer profits are $47 per head.
(Editor’s note: Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)
Related stories:
