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 market fairly steady
Little live trade was reported last week, ranging from $161.75-$162.50 per hundredweight. Weekly full dressed trade range was $275-$277 per cwt. delivered. Weighted average steer prices were fully steady with last week at $164.35 per cwt., and heifers firmed almost $2 per cwt. to $163.31. Cattle that traded last week were scheduled for the last week of December and the first week of January.
Read Also
USDA’s August corn yield estimates are bearish
The yield estimates for wheat and soybeans were neutral to bullish, but these were largely a sideshow when compared with corn.
Last week’s cash to cash fed basis strengthened to -$13.45 per cwt., and U.S. buying interest deteriorated. Before the Cargill High River strike vote deadline, western Canadian fed slaughter for the week ending Dec. 4 was down nine percent from the previous week at 38,242 head but was still six percent larger than the five-year historic average.
Year-to-date western Canadian fed slaughter was nine percent larger than a year ago, totalling 2,082,359 head and accounts for 80 percent of total Canadian fed slaughter so far this year. Year-to-date eastern Canadian fed slaughter was reported four percent larger at 527,765 head.
Ontario saw active fed trade last week with dressed sales steady to $3 per cwt. higher than the previous week in a full $275-$280 per cwt. delivered trade range. Average Ontario steer prices closed last week $3.22 per cwt. higher at $165.80 and gained a $1.50 per cwt. premium to Alberta.
Cargill Beef High River has resolved contract negotiations with employees, and supportive competition is anticipated. Early summer placed yearlings have had exceptional feeding conditions and are expected to hit the fed market during the second half of December.
In the U.S., light to moderate live trade saw weighted average prices around US$1 per cwt. lower in the south and mostly steady with the previous week in the north at $140 per cwt.
Light northern dressed trade was steady, with most sales reported at $220 per cwt. delivered. Calf prices rallied $2-$4 per cwt. higher last week with active year-end buying interest, and feeders traded steady to $4 per cwt. higher with strong demand on tightening supplies.
Cows above $70 per cwt.
Trading $4.50 per cwt. higher last week and averaging back above $70 per cwt., D2 cow prices were at the highest point in seven weeks. Peak non-fed volumes are past, and supplies should continue to moderate through the end of the year.
For the week ending Dec. 4, western Canadian cow slaughter totalled 6,778 head, nine percent smaller than last year. For the start of December, it was the smallest slaughter since 2004. In 12 of the last 15 years, butcher cow prices strengthened from November to December.
Butcher cow prices in November averaged $63 per cwt. and prices are well on track to exceed the historical increase of five percent. In the past 15 years, the largest month-over-month price increase from November to December was nine percent in 2006. Recent strength in the cow market has seen U.S. buying interest soften.
Bred cattle price strengthens
The fall calf run started much earlier than normal this year so total auction receipts for late November and early December have been lighter than normal. Over the past four weeks, Alberta auction volumes totalled 178,000 head. In the past 30 years, only two have seen smaller volume: 1993 and 1994.
The western Canadian feeder index (700-899 pounds) gained $4 per cwt. while the calf index (500-699 lb.) has advanced by about $5 per cwt.
The tough spot on the market is still lighter weight calves less than 500 lb., for which prices are near annual lows. In Alberta, only 750, 850 and 950 lb. steers are trading higher than the five-year average.
Forward delivery prices are $10 per cwt. higher than current cash prices. The feeder basis level for March delivery is around -$18.75 per cwt.
The strength of the bred cattle market has been a surprise. Young cows coming from herd dispersals and reputation bred heifers are seeing the strongest demand. Last week, Alberta bred cows traded from $1,100-$2,450 per head, averaging $1,725. Bred heifers traded from $1,650-$2,600 per head, averaging $2,000.
U.S. cutout declines
In U.S. beef trade, cut-out values continued a seasonal decline. Choice averaged US$264.55 and Select averaged $251.68 per cwt. Values are expected to go lower until February on reduced demand and ample offerings.
