Cow-calf and feedlot operators are enjoying record margins, while beef packers have remained in negative territory since 2024. The shortage of market-ready cattle and higher labor costs continue to pressure the sector’s profitability.
According to the Institute of Meat report, “packer margins slipped into negative territory in September 2024” and, as of October 4, 2025, stood at –US$ 126.50 per head, with a full-year projection of –US$ 165.96. In contrast, feedlot margins rose to US$ 514.33 per head, up 351% from 2024, while cow-calf margins climbed to US$ 900 per head, an increase of 122% year-on-year.
Finished cattle averaged US$ 232/cwt in the first two weeks of October, surpassing even the 2015 inflation-adjusted peaks. The producer’s share of the retail beef dollar reached 55%, while the packer’s share fell from 13% in mid-2023 to 5% in August 2025. This imbalance underscores the strain between a historically tight cattle market and a processing industry facing idle capacity and mounting operational costs.
The report also highlights ongoing uncertainty surrounding immigration and trade policy, which “add to the cost pressures in the beef market.” Many plants have reduced shifts and shortened workweeks as they strive to maintain throughput amid strong domestic beef demand.
