Profit Tracker: Pork producer margins remain in the red

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Although still mired deep in the red, pork producer margins struggled a bit higher last week. For the week ending Sept. 21, producer’s margins, as calculated by Sterling Marketing, Vale, Ore., were -$30.88 per head, up over $5.00 from the prior week’s $36.15 deficit. Lean-carcass prices for the Western Corn Belt improved to $69.97 per hundredweight on the week, compared with $65.85 as of the previous Friday.

The small improvement in production margins was a welcome change as margins have tumbled over the past several weeks. One year ago, margins were $5.45 per head, according to Sterling Marketing.

Feed prices for hogs placed in finishers as of Sept. 21decreased about $4 from the previous week to $132.01.That compares to $107.15 one year ago.

While a trend to lower hog market weights is expected, it is still a bit early to track the reduction as many producers had contracted their inputs months ago and market weights have generally held steady. Meanwhile, producers keep a close eye on packers’ weight grids for some relief in weight discount penalties for lighter hogs.  

Pork packer margins weakened to $12.76 per head for the week ending Sept. 21, compared to $25.16 the week before and $9.18 for the same week a year ago.

The Sterling Pork Profit Tracker  for the week ending Sept. 21:

  • Average farrow-to-finish margins: ($30.88) per head
  • Average pork packer margins: $12.76 per head

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 cattle margins continued their fluctuations and for the week ending Sept. 21 declined to a loss of $45.15 per head. This compares to a loss of $16.60 calculated for the prior week. One year ago cattlemen were losing $53.12 per head.

Packers recorded a loss of $51.58 per head, compared to a loss of $54.09 the prior week. One year ago, packers were losing $10.59 per head.  

The Sterling Beef Profit Tracker   for the week ending Sept. 21:

  • Average feedlot margins: ($45.15) per head
  • Average packer margins: ($51.58) per head
  • Sterling Profit Quotient: -149,4

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.



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