Pork producer losses eased last week as margins improved nearly $7 per head compared to adjusted losses calculated for the previous week, according to Sterling Marketing, Vale, Ore. For the week ending Dec. 7, producers lost an average of $28.72 per head marketed compared to adjusted losses of $35.45 for the week ending Nov. 30.

Hog packer margins declined for the week and slipped into negative territory. For the week ending Dec. 7, Sterling Marketing calculated a loss of $2.14 per head, down nearly $6 from an adjusted $3.82 profit recorded the previous week.

Farrow-to-finish producers lost an average $28.72 per head for the week ending Dec. 9. One year ago, producers were losing $4.77 per head, according to Sterling.

One reason for the margin improvement could be related to fewer hogs harvested for the week. Hog slaughter last week totaled 2.364 million head, down 1.5 percent from the week before, but up 1.5 percent compared to the same week last year, according to Ron Plain and Scott Brown, University of Missouri agricultural economists. Year-to-date hog slaughter is 1.9 percent above 2011.

Feed costs for the week ending Dec. 7 inched up by a few cents from the week before, coming in at $132.05 for hogs placed into finishing on that date.  Hog prices delivered a nice gain for the week providing $86.06 per hundredweight carcass versus $81.53 recorded the previous week.

The Sterling Pork Profit Tracker for the week ending Dec. 7:

  • Average farrow-to-finish margins: -28.72  per head
  • Average pork packer margins: -$2.14 per head

Meanwhile,cattle feedlot margins plummeted last week dropping over $66 compared to the prior week. Losses averaged $113.19 per head for the week ending Dec. 8. That compares to losses of $46.94 per head the week before and a $15-per-head loss for the same week in 2011.

Sterling Marketing provides the Sterling Pork and Beef Profit Trackers, which are calculated using actual weekly prices for hogs and cattle, feed costs, pork and beef cutout prices, drop credits and other factors that influence profit margins.

Beef packer improved somewhat but were also reported in the red by $74.33 per head for the week ending Dec. 8. Sterling reports beef packers lost $82.37 per head for the week ending Dec. 1; one year ago, losses averaged $78.74.

The Sterling Beef Profit Tracker for the week ending Dec. 8:

  • Average feedyard margins: -$113.19 per head
  • Average packer margins: -$74.33 per head
  • Sterling Profit Quotient: -360.5

The Sterling Pork and Beef Profit Trackers are produced by Sterling Marketing Inc., Vale, Ore., John Nalivka, president, and are published weekly by Pork Network.