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.
Fed cattle rally
The weighted steer average was $168.93 per hundredweight, and heifers were $167.34.
Most reported trade was dressed at $284 delivered, which was up $4-$9 over the previous week.
American packers bought a few cattle on a five-area basis again, but the stronger Canadian dollar limited cross border marketing.
The week’s cash-to-futures basis widened to -$16.01 and is now more than $5 weaker than the five-year average.
Weekly western Canadian slaughter to March 12 fell three percent to 27,843 head. The steer carcass weight fell two pounds to 937 lb. Weekly exports to March 5 rose nine percent to 6,662. Exports this year are up 40 percent at 54,755 head.
Market-ready supply is expected to increase modestly, but packers have a comfortable supply.
Weaker basis levels will attract U.S. buyer interest, particularly if the Canadian dollar weakens.
U.S. live cattle futures rose on rallying beef prices as retailers bought supply in anticipation of an early spring grilling season, tighter supply of market ready cattle and improved packer margins.
Light live trade developed March 18 in the southern United States at prices $2-$3 per cwt. higher at US$140.
Dressed sales in the northern U.S. were reported $3 higher at $223.
Auction volume tightened.
D1, D2 cows ranged C$100-$114 to average $106.79, up seven cents. D3 cows ranged $85-$105 to average $97.50, up $2.
D1, D2 cows have traded in a $6.50 window since the beginning of the year, ranging from $104-$110.50.
It is the third narrowest range in the past 15 years, behind only 2001 and 2013.
Speculative interest continues in the non-fed market as a few cows go on feed in anticipation of a spring rally.
Chicago live cattle futures have risen to levels not seen since early November, but the strong loonie has kept prices in Canada weaker and weighed down feeder prices.
The highest price for 550 lb. steers this year was set in early February at $277.40.
The usual stocker calf rally has not developed yet this year.
Monthly steer prices have dropped from February to March in only five of the past 15 years.
Steer prices averaged $269 in February.
The March average is the mid to upper $250s.
Alberta auction volumes have increased. More fall-assembled cattle are coming back onto the market.
Some backgrounders are cutting their losses and marketing everything, hoping for a volume price premium. Others are selling only the heavy cattle.
Bids for April delivery are seeing little if any premium over the spot cash market.
Packers are delaying picking up cattle from feedlots, which is tying up pen space.
Choice was up $9.40 at US$234.64, and Select was up $9.12 at $222.97 March 17.
Momentum weakened late in the week.
Weekly Canadian cutouts to March 12 saw AAA rise 74 cents at $293.58 and AA was up $4.22 at $282.52.