For the week ending June 15, pork producer profit margins gained $11 per head over the prior week. The improvement reflects lower slaughter numbers and lighter slaughter weights as well as an increase in pork demand. Meanwhile, packer margins continue struggling- showing a $14.31 per head loss for the same week.
For farrow-to-finish producers, the average profit margin reported for the week ending June 15 was $30.86 per head, according to Sterling Marketing, Vale, Ore. That compares to a $19.76-per-head profit for the previous week and $18.59 per-head profit during the comparable week in 2011.
Feed costs continue to offer some relief but are inching their way higher reflecting growing concern over the worsening dry conditions in the U.S. Corn Belt. For the week ending June 15, feed cost ended at $110.60, up nearly $2.00 over the prior week.
Packer margins are still deep in the red, with losses registering $14.31 per head compared to the previous week’s deficit of $15.79 per head. The current loss compares to a loss of $3.62 per head for the same week in 2011.
Western Corn Belt negotiated hog prices rose to an average $96.96 per hundredweight for the week, up about $5 from the previous week. For the same week in 2011, hog prices averaged $94.38 per hundredweight.
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.
The Sterling Pork Profit Tracker for the week ending June 15:
• Average farrow-to-finish margins: $30.86 per head
• Average pork packer margins: -$14.31 per head
Cattle feeding margins fell precipitously for the week ending June 15. Feeder margins for the week averaged a loss of $152 per head, compared with a loss of $66.64 per head the week before, and a $26.10 per head loss for the same week in 2011, reports the Sterling Beef Tracker.
For the week, beef packer margins increased over $5 per head. By close of the week on June 15, packers reported a $28.02 per head profit. That compares with $22.72 per head the week before and $43.29 per head profit for the same week in 2011.
Cash fed cattle prices slipped by about $3 per head ending at $118.83. The week before prices averaged $122 per head and one year ago they were $108.32.
The Sterling Beef Profit Tracker for the week ending June 15:
• Average feedlot margins: -$152.18 per head
• Average packer margins: $28.02 per head
• Sterling Profit Quotient: -451.7
The Sterling Pork and Beef Profit Trackers are produced by Sterling Marketing Inc. and John Nalivka, president, Vale, Ore., and are published weekly by Pork Network.