Profit Tracker: Cattle Feeding Margins Top $200
Autumn’s fed cattle price rally has pushed average cattle feeding margins through the $200 per head barrier for the first time since well before the pandemic.
Cattle traded last week for a national average of $152.75 per cwt., the highest price in seven years, resulting in average profits of $207 per head, according to the Sterling Beef Profit Tracker. That’s $20 per head higher than the previous week. Profit margins may be up but so are the costs associated with finishing a steer.
Cattle placed on feed last week, however, are estimated to have a breakeven of $154.37 per cwt. That’s based on 750-800 lb. feeder steers at $179.01 per cwt., and feed costs of $597 per head. The feeder steer price is 14% higher than last year. The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Oregon.
Estimated beef packer margins for the week ending Nov. 5 were $70 per head, up $4 per head from the previous week and down 90% from estimated margins a year ago of $674 per head. Last week’s Choice beef cutout averaged $258.95 per cwt., about $2 higher than the previous week and down $26 per cwt. (9%) from the same week a year ago.
The estimated total cost for finishing a steer last week was $1,931 per head, up 10% from last year’s estimate of $1,751 per head.
Cattle slaughter totaled an estimated 667,000 head, about 15,000 head more than the same week last year. Packing plant capacity utilization was estimated at 89.2% compared to 89.3% the previous week and 88.2% last year.
Farrow-to-finish hog producers found profits of $1 per head last week, down about $17 with the previous week but up $32 per head from last year’s $31 per head losses. Lean carcass prices averaged $92.01 per cwt., down $7.21 per cwt. from the previous week but up $28.65 from last year (31%).
Pork packers saw profits of about $4 per head compared to losses of $6 per head the previous week and $57 lower than the $61 profits found last year. Hog slaughter was estimated at 2.577 million head, up 20,000 head from the previous week and down 35,000 head from last year.
Pork packer capacity utilization was estimated at 95.8% compared to 95.1% the previous week and 97.2% last year.
(Note: The Sterling Beef Profit Tracker calculates an average beef cutout value for the week in its estimates for feedyard and packer margins. Other prices in the weekly Profit Tracker also are calculated weekly averages. Feedyard margins are calculated on a cash basis only with no adjustment for risk management practices. The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs. Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)
