Fed cattle prices weaken
Chicago live cattle futures were battered lower most of last week because of poor beef demand and weak technicals that prompted funds to sell.
However, the week ended on a positive note with news that the American unemployment rate surprisingly fell to 10 percent in November from 10.2 percent in October. Better job news could improve consumer confidence and beef demand.
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In Canada, the Canfax weighted average price for steers last week was $77.03 per hundredweight, down $1.35 from the previous week. Heifers averaged $76.15, down $1.10.
Rail prices were $1.50-$2 lower.
Sales volume rose eight percent to about 21,000 head.
The cash to futures basis strengthened to $8.10 under from $9.11 under the week before.
Weekly fed exports to the United States to Nov. 21 rose five percent to 12,354 head, which was only one percent less than last year at the same time.
Market volume in North America is expected to increase in coming weeks. Chicago live futures must rally for cash prices to improve.
Beef demand could improve slightly this week as packers put inventory in the freezer before Christmas.
Slaughter cows up
D1, D2 cows traded from $28-$42.75, averaging $35 in Alberta, up $1 from the week before. D3 cows were $20-$35, averaging $29.86, down 40 cents. Weekly cow slaughter to Nov. 28 totalled 16,709 head in Canada and 13,222 in Alberta.
Butcher bulls were $30-$54.50 to average $44.95, up 60 cents.
Weekly nonfed slaughter exports to the U.S. to Nov. 21 were 6,551 head, up eight percent from the week before and nine percent over last year.
Poor quality discounted
Quality feeder steers and heifers sold steady, while plainer cattle were heavily discounted.
Steers on average fell $1.15 and heifers were 45 cents lower.
Auction volumes fell 11 percent to 56,231 head.
Weekly exports to the U.S. Nov. 21 were 1,207 head, down from 1,987 the previous week.
Feedlot demand could soften because of the gloomy forecast for fed cattle prices,. Most of the large pre-sort sales have taken place, which will also contribute to lower auction volumes. Quality will continue to affect feeder prices and buyer interest may wane as supplies dwindle.
Bred sale activity and prices improved.
Bred cows averaged $708.85, up $25, and bred heifers averaged $814.70, up $46. With light offerings, cow-calf pairs averaged $687.50.
Many herd dispersals and special bred sales are expected this month with prices expected to be firm.
Beef prices down
The normal boost in beef demand from the holiday season was short lived and dull.
U.S. Choice cutouts fell $4.35 US to close at $137.45 while Select fell $1.51 to $132.09.
Weekly Canadian AAA cutouts to Nov. 27 were $143.90 Cdn, down 25 cents. That was down $39.90 from last year. AA cutouts were $142.47, down 35 cents. That was down $38.58 from last year. The Montreal wholesale price for delivery this week was steady at $155-$161.
