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 markets posts lows
The Canfax fed steer weighted average was $126.74 per hundredweight and hiefers averaged $128.01.
Prices were down about $5 per cwt. and set new lows for the year. Prices were the lowest since December 2013.
Feedlot managers aggressively marketed cattle and sale volumes were the largest since May 2012.
Most of the trade was for dressed product, with prices ranging widely at $215-$227 delivered. Dressed prices were steady to $10 lower.
The cash-to-futures basis strengthened sharply to -$2.86.
Weekly Canadian slaughter to Sept. 3 was brisk at 51,969 head.
Steer carcass weights fell three pounds to 921 lb.
Weekly exports to Aug. 27 were steady at 5,267 head.
Positive packer margins should continue to fuel large fed kills but beef demand seasonally will decline.
With fewer forward priced cattle and large cash showlists, buyers will have market leverage over sellers.
In the U.S. last week most of the live trade was down US$4 and dressed sales were generally $8-$10 per cwt. lower.
D1, D2 cows ranged $90-$105 to average $95.63 per cwt., down almost $5.
D3 cows ranged $80-$89 to average $84.
Railgrade cows ranged $180-$185.
Bulls averaged $120.61 down $3.39.
Non-fed prices are expected to work gradually lower into the fall. D1, D2 cows will likely average in the upper $80s to low $90s by the end of the month.
Canadian bull slaughter volumes totaled 371 head, the second largest weekly volume reported over the past three years.
From February highs to current lows, 550 lb. steer prices have fallen 32 percent, the largest decline in 15 years.
And heifers for fall delivery are being discounted aggressively, with 550 lb. females trading $21-$35 per cwt. lower than same weight steers.
Eastern buyers are showing good interest in western Canadian calves but they are not as aggressive as last year, especially on heavier steer calves.
Alberta 850 lb. steers set new annual lows last week and Ontario prices were only 10 cent shy of new lows.
While prices are lower, basis levels remain historically strong.
Based on the five-year average, September is traditionally the strongest basis month of the calendar year.
With yearling prices at or near annual lows, many grass operators will continue to fight the market and look to maximize cattle weight while out on pasture.
The equity drain on the cattle feeding sector has been severe.
U.S. beef falls
U.S. boxed beef prices fell to Sept. 8 with Choice down US$6.60 at $189.14 per cwt. and Select down $5.86 at $182.63.
Lower fed prices and positive margins at the packing sector are encouraging cattle slaughter. U.S. beef production is up 4.8 percent so far this year. The additional supply could limit hope for a seasonal rally this fall.
Canadian boxed beef prices rose $8-$11 for the week ending Aug. 27 with AAA at C$265.37 and AA at $253.03.