With the weekly average all-cattle carcass weight hovering around 839 pounds, and fed cattle prices near steady last week at $109 to $111 per cwt, average unhedged feedlot losses were near steady.
Sterling Marketing Inc., of Vale, Ore., publishes its Beef and Pork Profit Trackers weekly through Drovers. The calculated numbers can be thought of as an index rather than an exact profit or loss since all feedlots and packing plants are different, and the Profit Trackers are calculated using only the cost of the feeders, feed costs and a USDA average price for the finished animals.
FEEDLOT LOSSES NEAR STEADY
The Beef Profit Tracker last week put feedlot margins for cattle sold during the week at a minus $17.05 a head, down $0.06, or 0.03%, from a minus $176.11 the week before but up $6.92, or 68.3%. from losses of $10.13 a month earlier. A year ago, feedlot margins were calculated at a profit of $209.69 a head.
To arrive at that calculated loss, John Nalivka, president of Sterling Marketing, used the USDA’s five-area direct price for fed steers of $108.81 per cwt, down $0.21, or 0.19%, from $109.02 a week earlier and $0.08, or 0.07%, below the $108.89 of a month earlier but $15.68, or 12.6%, less than the $124.49 of a year ago.
Nalivka also used a price of $141.63 per cwt for the feeder steers sold as fed cattle to packers last week. This came from the Oklahoma City auction price for 750- to 800-pound steers. It was down $1.72, or 1.20%, from $143.35 per cwt for the cattle that went to market a week earlier, up $6.52, or 4.83%, from $135.11 for fed cattle sold a month earlier and up $5.76, or 4.24%, from the $135.87 price for the fed cattle sold in the same week a year ago.
The cost of feed for the cattle sold for slaughter last week came to $1,496.87 per head. This was down $2.91, or 0.19%, from $1,499.78 a week earlier, up $50.00, or 3.53%, from $1,445.88 a month earlier and up $13.49, or 0.91%, from $1,483.38 a year earlier.
PACKER MARGIN UP
The calculated packer margin for cattle purchased last week came to $304.21 a head, up $97.14, or 46.9%, from $207.07 a week earlier, up $58.21, or 23.7%, from $246.00 a month earlier and up $224.56, or 281.9%, from $79.65 a year earlier.
The boxed beef price used was $108.81 per cwt, down from $109.02 a week earlier, down from $108.89 a month earlier and down from $124.49 a year earlier.
The drop credit was $142.05, versus $141.61 a week earlier, $137.48 a month earlier and $137.52 a year earlier.
CATTLE, BEEF RECAP
Fed cattle trading was reported this week at $110 to $113 per cwt, up $1 to $2 from last week. Dressed-basis trading last week was seen at $172 to $174 per cwt, down $2 to $3.
The USDA choice cutout Thursday was up $2.33 per cwt at $231.99, while select was up $1.89 at $220.88. The choice/select spread widened to $11.11 from $10.67 with 93 loads of fabricated product and 17 loads of trimmings and grinds sold into the spot market.
The USDA reported Thursday that basis bids for corn from livestock feeding operations in the Southern Plains were unchanged at $1.00 to $1.25 a bushel over the Mar CBOT futures contract, which settled at $5.34 1/2 a bushel, up $0.00 1/2.
The CME Feeder Cattle Index for the seven days ended Wednesday was $135.34 per cwt, up $0.51. This compares with Thursday’s Jan contract settlement of $135.70 per cwt, up $0.07 and Mar’s $139.80, down $0.27.