Market slides
Fed cattle prices averaged $3.50 per hundredweight lower for the week, said Canfax.
Cattle futures prices were down early as traders worried about the effect of war with Iraq, rising unemployment and higher fuel prices on beef consumption. But the market became somewhat more optimistic by the end of the week.
Offerings were smaller, partly due to the lower prices but also because producers are up to date with marketing and there is a smaller number of market-ready cattle. The volume sold fell 11 percent to 16,500 head.
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American buying interest was almost nonexistent with Canadian prices strong compared to the U.S. market.
More calves were in the mix, lowering carcass weights, but also reducing the number grading AAA and yields, said Canfax.
Alberta prices March 13 were steers $108-$112.25 per cwt., flat rail $183.35-$184.35 and heifers $109.50-$111, flat rail $179.50-$184.
Canfax said the stronger U.S. cash and futures market late in the week and the weaker Canadian dollar should help Canadian prices this week.
The futures market will be focused on the play between those worried about the weak U.S. economy and potential for slow beef demand, and on the other hand, the tight supply of market-ready cattle.
The exchange rate continues to be a key unknown.
In wholesale beef, American and Canadian kill lines are slowing. There appears to be plenty of product to move, with retail and food service buyers showing resistance.
U.S. Choice and Select cut-outs lost $3.50-$4.50 US but prices are similar to where they were a year ago.
The Montreal wholesale price this week is down $3-$6 Cdn at $185-$187 per cwt. The Calgary market is down $4-$7, with handyweight steers at $173-$176.
Feeders lower too
The weaker fed cattle market affected the feeder market, said Canfax.
Prices were $1-$4 per cwt. lower with some lighter calves down almost $6.
Feeder steers were $2-$4 per cwt. lower on all classes over 400 pounds, while heifers were $1-$3.50 lower.
The total volume at Alberta auction markets including computer and satellite sales March 7 was four percent larger than the week before at slightly less than 41,000 head. However, compared to the same week last year, the volume was 23 percent smaller.
The basis on feeder cattle in Canada was tight, -$1.50 per cwt. on 750 lb. feeder cattle.
The tighter supply of feeder cattle after last year’s record export of feeders is helping to narrow the basis. Canfax expects a tighter than historic basis for feeder cattle could hold true until at least the early fall.
Slaughter cows gained 60 cents, averaging $59.44 per cwt. on D1, 2 cows.
Canfax expects fairly steady feeder prices over the next few weeks.
Buyers still want to price heavier feeders lower to keep within a reasonable break-even level for the normally sluggish summer market.
A few cow-calf pairs traded at $1,000-$1,330. Bred cow trade was $740-$1,475 with most at $900-$1,325. Bred heifers sold as low as $800 but some sales were as high as $1,540. Most bred heifers traded at $1,000-$1,400.
Easter feast raises prices
Improved retailer demand for Easter hams raised U.S. wholesale ham prices last week.
Also, increased interest in loins and ribs contributed to a higher pork cutout value by the end of the week. This, together with a decrease in hog marketings, encouraged packers to raise bids for hogs.
Packers are still slaughtering hogs at above year-earlier levels, but the gap is closing.
The Iowa-Minnesota daily direct hog price (plant mean, 51-52 percent, lean carcass converted to live weight) rose from $37.10 US per cwt. on March 10 to $38.04 on March 13.
The week’s average hog price was about 3.5 percent above the week before.
