Down 146%: Beef packer margins have hit their lowest point in five years

Beef packer margins have hit their lowest point in five years; since this time last year they have fallen more than 146%.

Last week, processors lost an average of about $102 dollars per head, compared to about $82 dollars a head the week before. Wholesale beef prices were down about a dollar.

Feedlot margins on the other hand have skyrocketed, that is according to the Daily Livestock Report and the Sterling Beef Profit Tracker.

USDA Meteorologist Brad Rippey breaks down how drought is impacting the cattle industry: “Taking a look at some of the livestock numbers for the month of July 1st of all hay production area in drought— 30% on August, first down slightly from 32% at the beginning of the month and then the U.S. cattle inventory in drought, the current number August 1st, 37% of the U.S. cattle inventory in drought down 41% from June 27th.”

So, we can see a little improvement in conditions for livestock, which we hope to see continue to help straighten out the market.

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