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.
Feeder volumes light
The feeder and calf market exhibited seasonally lighter volumes with varying quality. Calves and lightweight stockers weighing 400-600 pounds and the bigger steers over 900 lb. achieved the market low for 2019. The price spread between a 750 lb. steer at $189.50 per and 950 lb. at $158.58 was just under $31 per cwt. this week. It is not uncommon to see the price spread narrow between 750 lb. and 950 lb., but in the last three years the price spread is more typically about $20 per cwt.
The Alberta 850 lb. cash to futures basis remains historically strong. For the last two weeks basis levels were the strongest they have been this year.
Canadian feeder exports for the first half of June are up 51 percent compared to 2018. Weekly exports of slaughter cattle including steers, heifers and cows were more than 10,000 head, up 35 percent from this time last year.
Packing sector sees shift
The Chinese ban on Canadian red meat because of the discovery of fraudulent pork export certificates and traces of the banned substance ractopamine in the shipment have caused a shift in the packing sector. Local packers pulled ractopamine-free export premiums, and dressed bids Wednesday plummeted $15-$20 per hundredweight below the previous week.
Market-ready supplies were current this week and bids eventually firmed. Weighted average Alberta fed prices slipped $3.75 and $4.75 per cwt. lower than last week for steers and heifers, respectively. Dressed sales were $238-$244 per cwt. delivered.
An annual low was established in Alberta this week with fed steer prices down 12 percent from the first half high to $143.19 per cwt. Last year’s market annual low was established in August at $142.04 per cwt.
Western Canadian fed cattle slaughter for the week ending June 22 was two percent larger than the previous week at 45,759 head, and so far this year it is five percent larger with nearly a million head being killed.
A short four-day kill week is anticipated for the first week of July due to the July 1 holiday, but market-ready supplies should remain manageable moving forward.
Cows moving to market
Many commercial auction facilities reported large volumes of cows and bulls offered for sale, but recent rain across the prairies seems to have slowed that trade.
Butcher bull prices are slightly higher than last year and are trading within $4 per cwt. of their annual highs set back in late May. Alberta D2 cow prices are trading at a premium of about 12 cents per cwt. compared to the U.S. utility market, but this is the narrowest the price spread has been since July 2016.
Western and eastern D2 cows traded in the $72-$92 per cwt. range.
Dry conditions early this spring hurt the cow-calf pair market. More cow-calf pairs were placed in feedlots and background yards this year than last year these cows may not get bred back to calve next year. Those destined for slaughter will probably go to market in late summer or early fall.
Beef trade softening
U.S. cut-out values softened this week with Choice down $1.69 per cwt. lower and Select $4.58 per cwt. lower. Weekly demand was reported light to moderate on moderate to good offerings. Tight supplies of Choice rib limited downside and prices eased modestly 71 cents per cwt. lower while Select rib plummeted more than $19 per cwt. Loins slipped $4.53 and $7.47 per cwt. lower for Choice and Select, respectively, while brisket fell sharply $20.15 and $15.41 per cwt. lower.
U.S. steer carcass weights for the week ending June 15 were three lb. heavier than the previous week but seven lb. lighter than a year ago.
Canadian cut-out values for the week ending June 21 slid $1.18 and $0.83 per cwt lower than the previous week for AAA and AA, respectively. Canadian fresh 85 percent trim eased five cents per cwt. lower than the previous week to $2.74 per lb.
Quality grades also fell below the average. Slightly more than half the carcasses made AAA when the yearly average is 63 percent. More than 40 percent were graded AA and 1.6 percent were Canada Prime.