This cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattle 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 slump
Following 12 weeks of static pricing, average Alberta fed steer prices slipped to a 28-week low. A combination of negative packer margins, increased formula price commitments and concerns of reduced demand contributed to softer North American fed cattle prices.
Read Also
Russian pulse trouble reports denied
Russia’s pulse crop will be larger than last year, which won’t help prices rally from their doldrums.
Scattered light dressed trade was $3-$5 per hundredweight lower than the previous week from $385-$387 per cwt. delivered.
The weighted average steer price eased $2.21 per cwt. lower than the thin trade seen in the previous week to $230.89 per cwt.
Western Canadian fed slaughter for the week ending Nov. 4 was two percent lower than the previous week at 43,642 head. Year-to-date western fed slaughter was down six percent from the same week last year. Western Canadian steer carcass weights were seven pounds larger than the same week last year at 967 lb.
Fed cattle/cow exports to the U.S. for the week ending Oct. 28 were 13 percent larger than the previous week at 11,404 head and were fully steady with a year ago.
Light Ontario trade saw prices fully steady with the previous week at $395 per cwt. Multiple buyers procured a few cattle to top up mid-November kill inventory.
More fed cattle continue to be contracted or formula priced, and the cash market has lost leverage.
In the U.S., negative U.S. Department of Agriculture cattle-on-feed estimates decimated cattle futures, and the cash market slid lower. Live trade was reported around US$4-$5 per cwt. lower than the previous week at $180-$181 per cwt. in most major feeding areas. Light dressed trade was generally $5 per cwt. lower than rail sales seen in the previous week, with most reported at $287 per cwt. delivered.
Total U.S. slaughter last week was estimated two percent lower than the previous week at 618,000 head and eight percent lower than year ago.
Cows trade lower
After four weeks of higher prices, the butcher cow market exhausted its run, trading $4-$5 per cwt. lower last week. D2s averaged $133.94 and D3s averaged $118.29 per cwt. The market is working through peak non-fed numbers, and cow prices are expected to bottom in the next couple of weeks.
From a North American perspective, Alberta cow prices have been trading at a $5-$22 per cwt. premium against the Ontario market over the past month. In Western Canada, with higher cow prices in October, many speculative buyers who would normally put cows on feed have been waiting for prices to decline.
Cows being put on feed will likely be targeting the holiday or early New Year market. Based on the five-year average, butcher bull prices historically trend lower from now through the end of the year, whereas cow prices usually bottom in November and strengthen into December.
Feeders take a hit
Live cattle contracts dropped $10 per cwt. over the course of last week, and feeder contracts were down $16 per cwt. Western Canadian calf and feeder prices trended lower as the week progressed. In general, the calf market has fared a bit better than the heavier weights.
Last week, feeders heavier than 800 lb. traded $2-$6 per cwt. lower, and prices were at the lowest point since July. Eastern Canadian buying interest on the spot and forward delivery feeder market has been quiet. Logistics issues have likely moderated eastern Canadian buying interest on the western Canadian market.
Most of the calves being marketed on the cash market are freshly weaned, just off the cow. There have been a few pre-conditioned calves on offer, but no premiums are being paid.
Last week, Alberta 900 lb. and heavier heifers for January delivery averaged in the mid $280s per cwt. Forward delivery prices are seven percent higher than the cash market. Over the past couple of years, the average monthly price increase from November to January stands around four percent.
Canadian feeder cattle exports for October totalled slightly more than 21,000 head, 240 percent higher than last year. This is the largest October feeder cattle export volume since 2014.
Cutout price eases
In U.S. beef trade, cutouts eased nearly two percent last week. Choice closed at US$299.42 and Select at $269.42 per cwt. Since October, cutout values have averaged 19 to 23 percent stronger than last year and 28 percent stronger than the five-year average.
