Have Feeding Margins Peaked? Hog Margins Remain Steady

Negotiated cash cattle increased $6 the week ending Jan. 25 while feedlot margins increased $77 per head to an industry average of $325.69 per head, according to the Sterling Beef Profit Tracker. Meanwhile, beef packers saw losses improve $11 per head to a loss of $71 per head. That puts the packer/feeder margin spread at $319 per head in favor of the feeder.

Cash cattle averaged $210.22 per cwt. the week ending Jan. 25, while Comprehensive Beef Cutout prices posted a $1.48 per cwt. increase to close at $331.85 per cwt.

Cattle marketed last week carried a total feed cost of $473.59 per head, about $80 more than feed costs for cattle sold the same week a year ago.

Cattle placed last week are calculated to have a purchase price for 750-800 lb. feeder steers at $273.53 per cwt., up $8 from a month ago.

The estimated total cost for finishing a steer last week was $2,861 per head, up from last year’s estimate of $2,391 per head.

Fed cattle slaughter totaled an estimated 486,388, down 2,367 head from the same week last year. Packing plant capacity utilization was estimated at 83.4%, down slightly from 83.8% last year.