Extreme packer profits climbing

Beef packer margins continued to grow last week even as cash fed cattle prices advanced $1 per cwt. The average packer margin was estimated at $372 per head, up $29 from the previous week, according to theĀ Sterling Beef Profit Tracker. Packer margins have more than doubled over the past month.

Meanwhile, cattle feeding margins have slipped into the red. Last week feeders lost an average of $42 per head, slightly better than the $57 losses recorded the week before, but $65 less than the $107 profits of a month ago. The Choice beef cutout price closed on Friday at $227.53 per cwt.

Cash cattle prices improved $1 per cwt. to $110.30. The cost of finishing a steer last week was calculated at $1,578, which is $171 higher than the $1,407 a year ago. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

A year ago cattle feeders were earning $486 per head. Feeder cattle represent 74% of the cost of finishing a steer compared with 73% a year ago.

Source: Drovers