Canfax report

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 fall

Hopes for a market recovery were dashed last week as the Chicago cattle futures market fell, closing limit down Sept. 30.

Cash cattle in the United States and Canada were also lower.

A surplus of all types of meat is pressuring the market lower.

The Canfax steer weighted average last week was $130.73 per hundredweight, down $3.34, and the heifer volume was too light to set an average.

The market was volatile in September with Alberta fed steer prices ranging from $128-$134.

The Alberta-Nebraska cash-to-cash basis is strong at about -$5.35, so it’s not surprising that there were no U.S. sales during the week.

Lift times have tightened to two to four weeks.

Weekly fed exports to Sept. 17 totalled 5,362 head. Exports are up 40 percent for the year but are still the second lowest in nine years.

Packers may pull hard on October contract cattle in the first half of the month compared to the second half.

Monthly prices have risen from September to October in 10 out of the past 15 years. The average increase over those 10 years was 2.9 percent.

Dressed sales in the northern U.S. were US$5-$6 lower, while southern regions were $3-$4 lower on a live basis.

Cow weaker

D1, D2 cows ranged C$84-$98 to average $90 per cwt., down $1.07.

D3 cows ranged $72-$85 to average $80.33.

Rail grade cows ranged $171-$175.

Butcher bulls fell 40 cents to average $115.46.

Weekly non-fed slaughter to Sept. 24 rose 12 percent to 5,051 head.

Weekly exports to Sept. 17 rose 20 percent to 5,992 head.

Exports are down nine percent for the year.

Supplies are expected to increase.

Feeders fall

The Alberta feeder market started steady last week but then fell, pressured by the falling fed market.

Steers fared better than heifers, falling only 84 cents per cwt. on average.

Heifers saw a wider variety of lot size and quality, pulling the average down almost $2.50.

Calves lighter than 600 pounds were steady to modestly higher, while feeders heavier than 600 lb. were steady to $3 lower.

The calf-yearling spread is very narrow, which indicates more buying interest in larger feeders than calves.

However, the steer spread is beginning to widen.

Auction volume fell from the previous week. Volume is down nine percent this year at 811,285 head, thanks to favourable grazing conditions.

Exports to Sept. 17 slipped to 2,094 head and are down 40 percent for the year.

Volumes should be steady for the next few weeks, which will support prices. Increased demand for bunk replacements is anticipated.

However, negative feeding margins mean prices will continue to struggle.

U.S. beef rises

Fed cattle prices fell, but U.S. beef cut-out values rose, allowing packers to increase their profit margins.

U.S. Choice rose $2.40 to $189.77 per cwt. Sept. 29, but Select fell 68 cents to $178.94, mostly because of weaker Select ribs and loins.

The growth in boxed beef prices may be difficult to sustain as cattle prices decline.

Weekly Canadian boxed beef prices to Sept. 17 fell with AAA at C$240.03, down $2.57, and AA at $234.40, down $1.18.

The coming Thanksgiving long weekend puts the retail focus on turkey and ham, but falling beef prices this year could encourage sales.

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