Beef - General
After slicing more than 50% off the monstrous losses found a month ago, cattle feeders saw their margins slip $43 per further into the red last week with $2 per cwt. lower bids.
Feedyard closeouts saw a $100 per head improvement last week, bringing losses under the $300 per head mark for the first time in months.
Another miserable week left many in the cattle feeding business on the brink of financial ruin.
A $6-plus per cwt. gain in cash cattle prices produced a 20% improvement in feeding margins.
Cattle feeding margins improved by 50% over the past two weeks, and by 38% during the past week.
The march toward break even for cattle feeders stumbled last week as average losses increased $36 per head, leaving closeouts $113 in the red, according to the Sterling Beef Profit Tracker.
Last week’s $2 per cwt. rally in cash fed cattle prices helped feedyard closeouts improve nearly $100 per head.
Cattle feeders generally expected margins to be much better by now. An anticipated spring rally that could have erased a lot of red ink has failed to materialize, leaving feedyard closeouts stuck in neutral with near $200 losses.
Cattle feeders turned a tidy profit for the second consecutive week.
Cattle feeders earned average profits of $68 per head last week, $30 per head more than the previous week.
Last week’s $2 per cwt. decline in cash cattle prices left feedyard margins at near breakeven levels.
Calling losses of $193 per head an improvement may be painful, but it’s accurate.
Cattle feeding profit margins retreat further with a weaker cash market and limited packer interest.
Average cattle feeding losses totaled $106 per head for the week ending June 21.
The Sterling Beef Profit Tracker reports average cattle feeding closeouts were in the black last week, but with little room to spare.
Beef packers continued to maintain their leverage on cattle markets heading into the holiday-shortened first week of September.
Cattle feeding margins slipped further into the red last week on soft cash prices, while packer margins climbed to extreme heights.
Last week’s $2 rally in cash cattle prices helped narrow the spread between feedyard losses and packer profits.
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.
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 feeders continue to find modest profits on a cash basis despite last week’s $2 per cwt. market retreat.
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.
Beef packer profit margins fell to their lowest level in nearly two years last week while cattle feeding margins exceeded triple digits for the second consecutive week.
Cattle feeding profit margins exceeded beef packer margins last week for the first time in more than two years as cash cattle prices have increased 20% since September.
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.
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.