World Perspectives
livestock

Livestock Industry Margins

Livestock industry margins were mostly lower last week as rising input costs crimped the profitability outlook. Declines were greatest for feedlot placements, where margins fell over $50/head due to higher feeder cattle costs. Beef packer margins saw the next greatest declines with profits dropping $35/head and hitting their lowest level since WPI started estimating packer margins in 2010. The decline in beef packer margins came amid last week’s $5-8/cwt rally in fed cattle prices that was partly offset by a $5 gain in beef values. The rally in fed cattle prices helped push feedlot closeout margins sharply higher, however, and to near five-year record highs.  The pork sector saw packer margins decrease slightly on weaker pork val...

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From WPI Consulting

Weighing in on strategic realignment

WPI’s team was retained by the governing board of a U.S. industry organization to review a decision, reached by vote, to invest significant assets into the development and management of an export trading company. WPI’s team conducted a formal review of this decision and concluded that the current level of market saturation would limit the benefits of the investment. Based on WPI’s analysis and recommended actions, the board subsequently reversed its decision and undertook a strategic planning effort to identify more impactful investments. On behalf of numerous clients, WPI has not only assisted in identifying strategic paths but also advised their implementation.

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