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 prices steady
Alberta direct cattle sales saw dressed prices comparable with the previous week from $300-$305 per hundredweight delivered. More cattle were priced from $300-$303 delivered to push the weighted average steer price $1.31 per cwt. lower than the previous week. Most of the cattle priced last week were scheduled for Nov. 14.
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Carcass weights surged larger on good feeding conditions. and feedlot managers scrambled to book hook space to avoid weight discounts. Western Canadian steer carcasses were 19 pounds heavier than the previous week and were 30 lb. larger than year ago.
Western Canadian fed slaughter for the week ending Sept. 24 was up nine percent from the previous week to 47,883 head. Canadian fed cattle/cow exports to the U.S. for the week ending Sept. 17 were eight percent larger than the previous week at 8,443 head and eight percent smaller than the same week last year. Year to date, fed cattle/cow exports were 14 percent larger than last year at 339,887 head.
Light Ontario trade trended sideways last week with dressed sales at $303 per cwt. delivered. Most cattle were scheduled for the week of Oct. 17.
In the United States, light to moderate mid-week Texas trade was reported steady with the previous week marked at US$143 per cwt. Northern trade also trended steady with live sales from $144-$147. Most dressed sales were from $228-$230 per cwt. delivered.
U.S. steer carcass weights for the week ending Sept. 17 firmed four lb. larger than the previous week to 918 lb. Feeder cattle sales have been hit or miss as drought-related marketing strategies are implemented.
Plentiful non-fed supplies
Seasonally large non-fed cattle supplies are on the horizon, and packers will gain leverage over sellers. Statistically there is little chance prices will strengthen from September to October because this has only happened once in the past 30 years.
Last week, D2s averaged $103.83 and D3s averaged $88.14 per cwt. Alberta cow prices are trading at roughly a $12 per cwt. discount to the U.S. market, suggesting cows will continue to flow south. Western Canadian cow slaughter has been below last year for seven consecutive weeks.
Butcher bulls have been the shining star of the non-fed market. From their highs in August, butcher cows have dropped 12 percent, or $14 per cwt., whereas butcher bulls continue to trade within a couple dollars of annual highs. Last week they averaged $132 per cwt.
Fall run in high gear
Yearling supplies are winding down, and the calf run is kicking into full gear. Prices are at the highest point since late 2015 or early 2016. Last week, the biggest price jump was on lightweight calves under 500 lb. The market tone was stronger, but by the end of the week some pressure was noted on midweight calves (500-700 lb.).
After spending the past 10 months at a discount to the U.S. market, Alberta calf prices recently moved back to premium. From their lows, barley prices have strengthened around $50-$60 per tonne, but even with the recent strength, Alberta still has a cost of gain advantage over the U.S. As a result, Canadian feeder cattle exports to the U.S. have slowed and have been below last year in six out of the past seven weeks.
In general, the softer Canadian dollar is supportive for the cattle market, but it also makes our grain more competitive on the global market.
For September, monthly electronic and in-house video volumes totalled just over 136,000 head, the largest monthly volume on record. A lot of these sales were forward delivery calves, and a larger percentage of the calves were scheduled for delivery during the second half of October and early November.
However, will trucks be able to keep up? Logistics are a major concern as available trucks are already hard to come by. If long wait times materialize, health risks will increase, and buyers will have no choice but to price this into the calves trading on the spot market.
U.S. cutouts lower
In American beef trade, U.S. cutouts ended last week steady to slightly lower on active weekly trade. Choice cutouts ended the week down a slight 0.6 percent to US$247.55 per cwt. Select cutouts took heavy losses, down 3.1 percent to $219.21 per cwt.
