Western Producer Livestock Report

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Published: August 16, 2007

Fed cattle weaken

The fed cattle market was slightly lower last week due mostly to a lower fed market in the United States, said Canfax.

Fed steer prices ranged from $84-$86.50 per hundredweight live and $141.50-$142.30 on the rail, while heifers ranged from $84.40-$85.20 live and $138.50-$144 on the rail.

Steers averaged $85.81 per cwt., down 67 cents, while heifers were down 46 cents to $84.95. Trade was active with volume at about 23,000 head.

The basis was steady at $9.28 under, which should keep cattle moving to the U.S.

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Fed cattle exports rose two weeks ago to 11,465 head, the third consecutive week that exports exceeded 10,000 head. This has not occurred since spring.

Anticipation of a lower U.S. fed market again this week will keep the Canadian market on the defensive.

Offerings are expected to remain manageable, which should limit the downside pressure, said Canfax.

Basis risk will be a factor because the last two years have seen the basis widen after mid-August.

Beef dips

The cutout could not maintain the gains made two weeks ago.

The Choice cutout dropped 91 cents US to $143.91 and Select dropped 38 cents to $138.49, said Canfax.

The Choice-Select spread narrowed slightly to $5.42.

Beef movement rose as the lower prices seemed to help packers move product, but the hot weather covering much of the U.S. likely is hindering demand.

Canadian packers have to contend with the lower U.S. prices on many products and the fact that grilling season is nearly over.

Food service demand is described as dull as well.

The Calgary wholesale prices for delivery this week were $1 lower at $149-$152.

Feeders stronger

There was positive news that Rule 2 has moved to the U.S. Office of Management and Budget.

It is expected to be several months before a decision, but it is one step closer to having the border open to cattle older than 30 months.

Feeder cattle trade was strong with almost all weight classes trading higher, said Canfax.

Light steer calves 300-600 lb. were $1.25-$5.50 higher and heifer calves 300-600 lb. were $1.50-$4.50 higher.

Steers 700-800 lb. were steady to $1 higher and heifers 700-800 lb. were $1.50 higher.

Steers 800-900 lb. were down 50 cents and 900 lb. and heavier were steady. Heifers 800-900 lb. and heavier were $1.50-$3.25 higher.

Alberta auction market volume at 16,007 head was eight percent larger than the week before and 25 percent smaller than last year.

Butcher cows were stronger with the bottom end firming. Butcher cows rose 50-75 cents and butcher bulls were $1.75 higher.

For the week ending Aug. 4, 3,334 feeders were exported, down 32 percent from the week before.

Auction market volumes are slowly increasing, said Canfax.

Poor grass conditions in parts of the western Prairies are pressuring producers to move cattle to market.

Limited offerings saw plain type bred cows and heifers at $500-$790.

Cow-calf pairs were mostly $900-$1,150 and plain types $600-$850.Hog prices climb

U.S. packers had a busy week, slaughtering more than two million head.

Cash pork prices have not kept up with rising hog prices, hurting packer margins and raising expectations for a slower kill pace this week.

Iowa-southern Minnesota hogs traded at $55 US per cwt. Aug. 10 from $54 Aug. 3.

The U.S. composite pork carcass cut-out value rose to $71.37 Aug. 10 from $70.95 Aug. 3. U.S. slaughter for the week was estimated at 2.01 million, compared to 1.99 million the week before and 1.89 million a year ago.

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