This cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattlemen’s Association. More market information, analysis and statistics are available by becoming a Canfax subscriber by calling 403-275-5110 or at www.canfax.ca.
Drought impacts markets
The continuing drought in the United States is driving more market uncertainty. In recent years North American cattle and grain prices have been strong, but that was supported by investors.
Their investments in cattle futures were based on higher prices driven by a smaller supply as herds continued to downsize. This pushed cattle prices higher, despite increasing grain and input costs. That is starting to change.
In Canada, barley prices have continued to go up and that is hitting the feeder and fed markets. Western barley at Lethbridge was trending around $248-$255 per tonne or around $5.09 per bushel for the week ending Aug. 3. Consequently, as grain prices increase, calf prices respond with lower bids this fall.
Poor profitability in the feedlot sector has made feeders reluctant to assume more risk and fill pens, reports Canfax. The industry is also facing a weaker basis throughout the year and the Canadian dollar is strengthening. It closed at parity on Aug. 3. However, last year at this time it was $102.09.
A tighter supply of fed cattle created some improvements at $2-$3 per hundredweight on dressed basis compared to last week. Heading into August, further improvements are anticipated with packers being short on supply and some American interest on fat cattle.
Live Alberta steers fetched $109-$111 per cwt. and $180-$184 per cwt. on the rail. Live heifers were $110-$112 and $181-$184 on the rail. This was the second highest weekly price since mid-June.
Ontario live steers ranged from $99.60-$118.78 and $181.85 to $193 per cwt. on the rail. Heifers were $85.80-$106.35 and $190-$193 on the rail. No prices were quoted for Saskatchewan or Manitoba.
Feeder market down
Feedlots have been reluctant to bid on a limited supply of feeder calves. This week, 400-700 lb. steers and 400-500 lb. heifers traded at their lowest price levels of the year.
Extreme market volatility and sinking feeder prices saw sellers postponing sales. Auction market volumes were down 17 percent from last week although numbers will rebuild for the fall market.
About 6,100 head moved through the ring. Feeder exports to the U.S. continue to drop with only 566 exported for the week.
Alberta steers in the 700 lb. range traded at $142.33, down $4 from last week. Smaller weights at 400-500 lb. averaged $160 per cwt., down $6 from last week. Bids on Ontario steers in the same category were $130.69, down $4 from last week. Lighter weight steers were $155.41 per cwt., up $2. No trade was reported from the other provinces.
Non-fed beef volumes dip
Western Canadian cow slaughter volumes were the second lowest of the year. Cows traded $1 lower than last week. With good grass conditions across the west, fewer cows are going to market. Exports to the U.S. are down, although drier conditions in the east prompted some sales.
Western D1, D2 cows averaged $77.75 per cwt. while the eastern market reported $64.15 per cwt.
Beef trade flat
Extreme heat in the U.S. has driven down beef demand. Choice ribs and loins were $3-$6 per cwt. while chucks strengthened by $3.
Canadian cut-out values for the week ending July 27 were mixed. Montreal wholesale for next week’s delivery is lower by a dollar at $207-$209 per cwt.