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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.

Feeders stronger

Feeder prices showed strength across the Prairies on calves and the lighter weight stocker market. January prices can be uncertain, and since the beginning of the month, 850 pound steers have dropped five percent, the largest January price drop since 2004.

Alberta steers in the 800-900 lb. class averaged $178.44 per hundredweight, Saskatchewan steers were $176 and Ontario averaged $152.19.

Alberta steers in the 600-700 lb. weight range averaged $201 per cwt. while heifers were $179.71. Saskatchewan steers traded at $199.75 and heifers were $177.71. Ontario steer bids averaged 206.75 and heifers were $177.89.

Canadian steer prices have been on par with the U.S. market so there is little incentive to export.

Feeder cattle prices have been strong in Alberta with 2017 showing the strongest cash to futures basis levels in the last 30 years. The 2017 basis in Alberta was a +0.51. The only other year to have a positive basis was in 1987 when it was +0.12.

Fed cattle stable

Fed prices showed stability this week, and next week could firm modestly higher. However, fed cattle dipped slightly this week, going down $1 from the previous week.

For the past two weeks, Alberta steer prices have traded at a $29.70 and $26.80 per cwt. premium to Ontario.

Live Alberta finished steers averaged $163, while Ontario was lower, ranging from $121-$148.29 per cwt. Heifer sale volumes were too small to establish a weekly price trend.

Dressed sales were reported at $274 per cwt. delivered.

Western Canadian fed slaughter for the week ending Jan. 20 was 23 percent smaller than the previous week, totalling 27,404 head. This is 11 percent larger than last year at this time.

Beef production is slowing, but overall 10 percent more is available compared to last year at this time. Total beef produced is at 126.8 million pounds so far. This includes fed and non-fed slaughter.

Cows and bulls

Alberta D1, D2 cow prices traded $4 per cwt. lower this week, the largest week over week decline since September.

Ontario cow prices slid $11-$12 per cwt. since the beginning of the year and are now trading $4 below their 2017 lows.

Alberta D1,D2 cows had been trading at a $22-$23 premium over the U.S. utility market prior to this week,, the largest premium seen in recent history.

Alberta D1, D2 cows ranged from $83-$98 per cwt., while Ontario cows were $61-$71 per cwt. Cows on the rail were $173-$178 per cwt.

Cows put on feed in the fall may be looking at negative margins if they were sold now. Producers may likely keep their cows on feed into February in hopes of stronger prices.

Year to date on Jan. 13, exports of cows and bulls to the U.S. were down nearly half at 3,590 head compared to 2017.

Cut-out values up

Canadian cut-out values for the week ending Jan. 13 were up by $1.03 per cwt. on AAA and $2.46 per cwt. on AA grades. The cutouts are currently two to five percent higher than year ago levels. The AAA-USDA Choice spread was at -$3.71 per cwt. compared to -$2.31 per cwt. a week ago and -$4.76 per cwt. last year.

Boxed beef prices for AAA cutout during the first week of January were $258 per cwt., while AA was $249.06, resulting in a spread of $8.94.

The price of trimmings is up over last year with 50 percent trim at 99 cents a lb. while 85 percent trim was priced at $2.54 per lb.

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