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Feedyard profit margins jump again

Feedyard profit margins jumped again marking the 15^th consecutive week of feedyard profitability.

According to the Sterling Beef Profit Tracker, profit margins were $370 per head – nearly 40 percent higher than last month.

John Nalivka, who publishes the report, says the biggest difference in feedyard profitability is the cost of the cattle and the cost of gain.  “My cost of gain is probably is in that 60 cent area now,” he says.  “If you look at the cattle that are coming out now they’re at a value that could pull these break evens down to a point that now there is some opportunity to have a pretty good margin in the cattle,” he says.

Nalivka tells Brownfield there are good opportunities for retained ownership at the farm and ranch level.  “That’s the positive,” he says.  “Even though prices are lower, it creates the opportunity to retain ownership and capture greater value from your cattle.”

Nalivka is the president of Sterling Marketing – based in Vale, Oregon.

AUDIO: John Nalivka, Sterling Marketing