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Despite a $2 decline in cash fed cattle prices, feedyard closeouts reported positive mid-winter results while packer margins held firm.

Cattle feeders and beef packers are both experiencing modest mid-winter profits, though both margins were slightly lower on cash prices of $121.

Feedyards saw closeouts improve dramatically last week after the cash cattle market posted its third consecutive week of higher prices.

Gains in cash fed cattle prices did not translate into higher profits for feedyards last week as higher feeder cattle prices were calculated into breakevens.

Beef packers saw their margins decline to the lowest level since before the Tyson packing plant fire August 9 as beef cutout prices declined and cash cattle prices increased.

The combination of shrinking packer profits and smaller feedyard losses over the past six weeks has reduced the packer/feeder margin spread by 27%, according to the Sterling Beef Profit Tracker.

Last week’s $1 increase in cash fed cattle prices did little for feedyard profits, but the $6.40 rally in wholesale beef prices added another $25 onto already large packer margins.

Cattle and hogs prices both moved higher last week and both enterprises posted profits on closeouts for the first time in several months.

Cash cattle prices lost another $2 per cwt. last week, a decline of $7 over two weeks. Coupled with higher input costs on feeder cattle, the decline feedyards with an average $22 per head loss last week.

Cash cattle prices stubbornly steady to $1 higher gave a slight boost to feedyard margins and left packer margins nearly unchanged last week.