Packer gross margins are defined by revenue derived from meat, hide and offal sales, less the cost of a fed steer or heifer. The current tight supply of cattle has made competition especially fierce during the past 12 months. As a result, packers have experienced a prolonged period in which beef processing gross margins have been particularly challenging. In fact, the 52-week moving average crossed below $100 in August, and the sector remains under pressure.
How long can the current scenario continue before rationalization occurs within the industry? Register your thoughts on this question and the data above in the comments section below.