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 trends higher
Fed cattle continue to trade in the summertime range of $143-$147 per hundredweight, although prices trended toward higher levels this past week.
Two of the three western packers were actively buying on the cash market with most of the cattle scheduled for Aug. 19 delivery. One packer was not active on the market, indicating it had all its slaughter cattle needs for August. Dressed sales were $246-247 per cwt. delivered.
Slaughter volumes are heavier than last year by nearly 3,000 more head per week. For the week ending July 27, Canadian federally inspected plants processed 1.79 million head, six percent higher than a year ago, 13 percent more than 2017 and 16 percent higher than the five-year average. Western Canada accounts for three-quarters of the Canadian kill. Since May, Canadian plants have been running in the 90-100 percent utilization range, the highest level since 2004.
U.S. packers showed some interest and, depending on freight and dressing percentage, their bids were in the low $140s per cwt. f.o.b. Canadian fed cattle exports to the U.S. for July are comparable with last year.
At the end of July, Canada AAA and Prime grading as a percentage of all A grade cattle was 53.95 percent compared to the five-year average of 58 percent, prompting packers to offer premiums for higher grading cattle.
Packer margins remain positive, and export and domestic beef demand is strong, but it must be cautioned that the seasonality of the market is lower over the next 30-60 days.
Feeder trade light
Calf and feeder volumes were light this week with a large proportion being sold through electronic auctions.
With light volumes at this time of year, there is a large price variance within weight categories.
Top-end freshly weaned 500 pound steers were trading well into the $220 per cwt. price range. Feeder prices also varied, depending on whether cattle were being sold off grass or out of a dry lot.
The price for 900 plus lb. steers has jumped almost $25 per cwt. in the last four weeks, and this has attracted some more selling interest.
Alberta steers in that heavier category averaged $187 per cwt., while Ontario was $172.84 per cwt.
Less mature yearlings coming off grass sold for a $10-$14 premium over dry lot cattle. Forward sales of yearlings for September and October delivery have been selling at prices generally steady with the current cash market. No trade was reported from the other provinces.
Steer and heifer prices have picked up the last few weeks but are still $5-$25 per cwt. below a year ago. Ontario interest continues to play on the western Canadian feeder market. American interest has been somewhat light, but they are not far behind in the current marketplace.
Cow trade moderate
Slaughter cow numbers at the beginning of 2019 were well above a year ago with first quarter slaughter 11 percent higher than last year and 26 percent higher than the five-year average.
Cow prices continue to strengthen this summer, gaining $4.56 per cwt. over the last five weeks. However, packers are working through large volumes of fed cattle so cow kills have dropped and are expected to remain moderate.
D2 cows averaged $88.56 per cwt. in Alberta, while Ontario averaged $85.21 per cwt. U.S. utility cow prices are trading at their highest prices of the year.
U.S. cut-out values trended steady to higher this week with Choice up $1.67 per cwt. and Select up 16 cents cwt. as the Labour Day weekend approaches. Choice middle meats and briskets saw the largest increase with ribs up $9 per cwt., loins up $3 per cwt. and briskets up $4 per cwt. Chucks and rounds remained steady with price changes within a $1 per cwt. range.
Canadian cut-out values for the week ending July 26 were mixed. AAA was $270.85 per cwt., up $3 from last week, while AA was $244.42, down $2 per cwt. The AAA-Choice spread strengthened from -$10.23 per cwt. to -$9.27 per cwt., while the AA Select spread weakened from minus 41 cents cwt. to -$4.36 per cwt. In contrast to the downtrend in the U.S., Canadian 50 percent trim values have been holding strong at around $120 per cwt. in the last couple of months, while 85 percent trim was $268.