Profit Tracker: Beef Packer Losses Continue; Pork Producer Margins Improve
Cash cattle prices posted solid gains the week ending March 16, boosting average cattle feeding margins to about $100 per head. Beef packers saw their margins improve more than $12 per head, yet average losses were estimated at $100 per head, according to the Sterling Beef Profit Tracker.
Cash cattle averaged $187.82 per cwt. the week ending Mar. 16, while composite wholesale beef prices posted $4 per cwt. gains to close at $299.20 per cwt. The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Ore.
Cattle sold last week carried a total feed cost of $384 per head, up about $9 per head from the previous week, and about $214 less than feed costs for cattle sold the same week a year ago.
Cattle marketed last week had a breakeven of $180.64 per cwt., while cattle placed on feed last week have a breakeven of $179.38 per cwt., which is about $7 per cwt. higher than a month ago. Cattle placed last week are calculated to have a purchase price for 750-800 lb. feeder steers at $252.40 per cwt., or $12 per cwt. more than a month ago. The feeder steer price is 26% higher than last year.
The estimated total cost for finishing a steer last week was $2,529 per head, up 17% from last year’s estimate of $2,105 per head.
Fed cattle slaughter totaled an estimated 471,785, down 20,868 head from the same week last year. Packing plant capacity utilization was estimated at 80.6% compared to 86.7% last year.
Farrow-to-finish hog producers found positive margins at $13 per head last week, up $4 from the previous week. Lean carcass prices averaged $80.41 per cwt., $2.65 per cwt. higher than the previous week and down just 40 cents lower than last year.
Pork packers saw profits of about $15 per head, or $3 per head less than the previous week. Last year pork packers saw profits of $2 per head. Hog slaughter was estimated at 2.471 million head, up 15,000 head from the previous week and down 20,000 head from last year.
Pork packer capacity utilization was estimated at 91.6% compared to 92.5% 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.)
