Winnipeg(CNS Canada) – With summer officially here, most Manitoba cattle are out to pasture and not moving through the auction rings. Many yards closed for the season or are running on a more relaxed scheduled.
Less than a thousand head of cattle were sold in the province during the week. Prices held reasonably steady for what was moving, with cull cows making up a larger-than-normal percentage of the volume compared to feeders.
“We certainly have a bit of a lull on the feeder markets, but there are still a few cull cows coming through the markets,” said Brian Perillat, of Canfax.
He noted that demand for the cull cows was good given the large supplies. Western Canada had its biggest slaughter since 2010, while U.S. meat production was also at its largest level in about a decade.
However, the trade dispute between the U.S. and China continues to overhang everything, lending an air of uncertainty to the cattle markets.
“If there are hiccups on trade, that will make pork cheaper here in North America and keep some pressure on the cattle market,” said Perillat. “The pork industry is much more reliant on exports than beef; and they’re very reliant on China and Mexico,” he added.
The weaker Canadian dollar, which hit its lowest levels relative to its U.S. counterpart of the past year on June 22, would normally provide some support for Canadian cattle markets. However, Perillat said the strong U.S. dollar internationally was cutting into their meat exports.
The trade issues are cutting into feed grain prices, which should be positive for the calf and feeder market heading into the fall, said Perillat.
While feed grain prices may be low, forages could be in short supply in some drier areas of Western Canada.
“We burnt through a lot of hay last winter and hay stocks are pretty short,” said Perillat. “Most guys are getting by, and if they get some rain they’ll be ok,” he added.
Conditions in Manitoba have been reasonably favourable for hay and pasture land so far, although there are dry areas in the southwestern corner of the province.
Looking at the state of the cattle market overall at the end of June, “the fed cattle market doesn’t look too bad, but these trade things could trump a lot of what’s going on . . . pardon the pun,” said Perillat.