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 slide

It was another tough week for the western Canadian fed cattle market with weighted average steer and heifer prices dropping $7-$8 per hundredweight. During the past month, fed prices have dropped $21 per cwt., going from the mid $140s to the mid $120s per cwt. last week.

For the end of June, fed cattle prices are at the lowest point since 2013. Fed steers averaged $125.16 per cwt. last week, down $8.33 and fed heifers averaged $123.29 per cwt., down $7.48.

Moderate trade was reported last week with three western Canadian packers buying cattle. Dressed sales ranged from $200-$212 per cwt. delivered. Lift dates varies from packer to packer. Cattle that traded last week would be picked up anywhere from one to six weeks. Some producers were willing to take less money for a quicker lift date.

Most of the yearlings have been worked through and more fed calves are entering the slaughter mix. With more calves coming forward, carcass weights have been trending lower in the last three weeks. Carcass weights seasonally bottom in late May or early June but given the slaughter disruption in April and May, carcass weight lows are expected to be about three to four weeks later than normal.

For the week ending June 20, western Canadian steer carcass weights averaged 858 pounds, down 11 lb. from the previous week. With the backlog of western Canadian fed cattle, carcass eights are expected to stay above last year for most if not the entire third quarter market.

Western Canadian slaughter totalled 47,470 head, the largest seen this year.

In Ontario, dressed bids were being reported from $220-$230 per cwt. delivered, which was $20-$30 per cwt. lower than the previous week. Packers were buying cattle for the first half of July delivery. Eastern Canadian fed slaughter totalled 11,392 head, two percent larger than last year and 19 percent larger than the five-year average.

With lower fed cattle prices last week, there was more talk about putting cattle on the set-aside program, which will be available this week for producers. This will take some big cattle off the market and hopefully moderate some selling pressure.

Even though slaughter volumes and exports are keeping pace with last year, it is important to note there has not been a draw down on backlog numbers.

In the U. S., dressed sales in the North ranged from US$152-$156 per cwt., which was $5-$11 per cwt. lower than the previous week. Lives sales in the South were reported from $94-$97 per cwt., which was $4-$5 per cwt. lower.

Weekly cattle slaughter volumes are estimated at 680,000 head, the second largest weekly slaughter this year. For the week ending June 13, beef cow slaughter totalled 68,232 head, the largest slaughter since 2011 for the middle of June.

Cow prices steady

Moderate volumes of non-fed cattle were reported at auction last week and prices were steady to slightly stronger. Slaughter cow prices were steady with the previous week. D2s averaged $84.57 and D3s averaged $75.57 per cwt. Butcher bulls saw prices firm at $1.36 per cwt. higher, averaging $117.50 per cwt.

Rail cow bids trended sideways at $160-$165 per cwt. delivered. Western Canadian non-fed slaughter for the week ending June 20 was fully steady with the previous week at 4,658 head and year-to-date was down 25 percent totalling 160,679 head. Supplies are expected to tighten and good domestic demand is anticipated through the summer grilling season.

Mixed feeder trade

Alberta feeder prices traded mixed last week with steer prices slipping modestly lower while heifer prices firmed modestly higher. Calves less than 600 pounds saw the largest deviation with steers sliding $3-$6 per cwt. lower than the previous week while heifer prices strengthened.

The weekly 550 lb. steer/heifer calf price spread narrowed to $27.40 per cwt., the lowest level so far this year. Eastern buying interest softened on the Alberta calf market last week as Ontario 550 lb. steer calf prices plummeted over $26 per cwt. lower than the previous week and shifted from a modest premium to Alberta to a sizable $16.68 per cwt. discount.

Large feeders over 800 lb. have seen prices steadily strengthen from April lows but average prices last week dipped $1-$3.75 per cwt. lower.

Weekly auction volumes were sharply 31 percent lower than the previous week but were 26 percent larger than the same week last year. Year-to-date auction volumes are 13 percent below year ago at 508,183 head.

USDA reports Canadian feeder exports for the week ending June 13 were mostly steady with the previous week at 880 head but a significant 82 percent lower than the same week last year. Total year-to-date feeder exports are down 47 percent at 70,248 head.

Auction volumes typically hit annual lows in July and this week’s offering was anticipated smaller.

Cut-out values shrink

In U.S. beef trade, cut-out values continued to realign to typical historic levels last week on seasonally larger production and softened beef demand. The Choice cut-out slipped $5.30 per cwt. lower than the previous week, to average $208.26, and Select eased $4.15 per cwt. lower to average $199.93 per cwt.

The Choice-Select spread continued to narrow to $8.33 as packers aggressively harvested large volumes of long fed heavy cattle.

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