Cash trade plays a major role in feeder and packer profit margins this week as a $2 increase above the previous week pushes profit margins in opposite directions.
Feeder profit margins averaged $76.48 last week, increasing $33.60 per head compared to the previous week according to the Sterling Beef Profit Tracker. Feeder margins are drastically higher than a month earlier when the average was negative $57.96 per head and are even better than the negative $83.47 average this time last year.
Cash prices improving by over two dollars, selling at $126 per hundredweight and slightly lower feed costs, down 60 cents per head contributed to higher feeder margins.
Packer margins fell lower, down $11.72 to average negative $35.35 according to estimates by Sterling Marketing, Inc., Vale, Ore. Packer margins were $18.27 per head a month earlier and negative $54.58 a year ago. Packer losses were eased by beef cutout prices inching 79 cents higher.
Pork producer margins retreated last week, but remain positive as negotiated cash hog prices lost $2.60 per hundredweight.
Producer margins last week averaged $4.57 per head according to the Sterling Pork Profit Tracker. Last week’s margins were below the $13.51 average a week earlier and $5.96 average a month ago. Last week’s margins did remain positive and are $19.66 above the negative $15.09 recorded a year ago.
Lower feed costs moved the calculated breakeven price $5.13 per head lower than a week earlier.
Pork packer margins remain negative and lost an additional $1.40 per head last week, moving to negative $4.45 per head.
The Sterling Beef Profit Tracker for the week ending September 28:
- Average feedyard margins: $76.48 per head.
- Average packer margins: -$35.35 per head.
The Sterling Pork Profit Tracker for the week ending September 27:
- Average farrow-to-finish margins: $4.57 per head.
- Average pork packer margins: -$4.45 per head.
The Sterling Beef and Pork Profit Trackers are produced by Sterling Marketing Inc. and John Nalivka, president, Vale, Ore., and are published weekly by Drovers/CattleNetwork, and PorkNetwork.