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.
Brighter outlook seen
Negative and unpredictable events over the past two years left many in the industry asking whether they were ever going to get a break. We finally get to answer “yes.”
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The expectation of tighter U.S. beef supplies in 2023, and one of the worst winters for the U.S. feedlot industry in recent memory, have impacted cattle performance and taken pounds off cattle. This fuelled bullishness in the live cattle complex, pushing live cattle contracts to new highs.
In Western Canada, fed prices have generally traded higher over the past 12 months, and the rally continues. From a seasonal perspective, there is more upside to the cash market as prices historically strengthen into the spring market.
Light trade developed last week with dressed sales ranging from $332-$335 per cwt. delivered. The Alberta fed cash-to-futures basis weakened, going from-$21.62 per cwt. to -$25.39. For the second half of February, this is the weakest basis level on record.
Light trade was reported in Ontario with dressed sales at $338 per cwt. delivered, $6 per cwt. higher than the previous week. Cattle were booked for immediate delivery.
Year to date, western Canadian fed slaughter is two percent larger than last year, while Canadian fed cattle exports to the United States remain above last year as well.
In the U.S., dressed sales in Iowa and Nebraska ranged from US$258-$262 per cwt., $5-$6 per cwt. higher than the previous week. Live sales in the northern feeding states were reported from $160-$164, $4 per cwt. higher.
U.S. steer carcass weights dropped six pounds to average 902 lb., 16 lb. smaller than last year but in line with the five-year average. Year to date, beef cow slaughter is six percent lower than last year, while dairy cow slaughter is up six percent.
Since the start of the year, cow prices have rallied $10 per cwt. on a live basis. As well, 90 percent lean trim prices have followed suit, trading at the highest level since October.
Cow prices rise
Non-fed slaughter totalled slightly more than 11,000 head last week. Cow slaughter was 10,900 head, and western cow slaughter was 8,400 head, the smallest weekly western cow slaughter so far this year.
Eastern cow slaughter jumped 400 head to total 2,500 head last week. Alberta D2 cows closed the week $1.80 per cwt. higher than the previous week, at $107.30 per cwt. This is the highest price since September 2022 and up 31 percent from the December lows. D3s traded at $94.50.
Ontario cull cows rallied $3 per cwt. higher last week to close at $109.95. Western cow slaughter should slow seasonally and feeder cattle prices continue to rise.
Feeder price strengthens
Light and mid-weight steers and heifers in Alberta traded stronger than the previous week. Light-weight steers were up $6-$7 per cwt., with heifers following at a moderate $1-$3 per cwt. increase.
Mid-weight steers for grass traded in a wide $1-$6 per cwt. increase, while the same weight heifers traded $4 higher. Heavier classes traded steady to $2 per cwt. lower.
Western auction volumes totalled just shy of 58,000 head, with Alberta volumes at almost 25,000 head. Bred heifers rallied more than $400 per head higher than the first week of February, averaging $2,417.
Bred cows lost ground from the previous week, down $35 per head to $1,850, and are fully in line with the first week of February.
Ontario 550 lb. steers have aligned with their Alberta counterparts, with Alberta 550 lb. steers trading at less than $1 per cwt. premium, down significantly from a $43 per cwt. premium in the second week of January.
Ontario 450 lb. steers narrowed the price spread, and Alberta 450 lb. steers were at a $21 per cwt. premium last week, down from $75 in the second week of January. Considering the narrowing of prices for light grass steers, movement of lighter feeders out of Ontario is expected to slow.
Snow last week across parts of the Prairies should add additional price support to light-weight feeders being backgrounded for grass this summer.
U.S. cutouts climb
In U.S. beef trade, cutouts climbed last week, with Choice closing three percent higher at US$287.91 per cwt. and Select cutouts closing five percent higher at $275.87.
