Canfax report

This cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattlemen’s 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 price doldrums

Weighted average steer prices have spent the entire third quarter below last year, although there was a modest price increase last week. Based on the five-year weekly average, this is the time of the year when fed prices traditionally bottom and begin to work higher until the end of the year.

Using this same data series, from the end of September to the end of December, fed prices on average gain 15 percent, or $21 per hundredweight. Using an historical increase of 15 percent would put fed cattle prices back to the mid-$150s per cwt. by the end of the year. A lot will depend on how fast we get through the fed calf supplies.

Some producers have intentionally pushed fed cattle out of the summer months and moved them into the October to January market. Assuming no slaughter disruptions in Eastern and Western Canada, it’s possible to get back to the $150s per cwt. by the end of the year.

Last week, dressed sales were reported from $224-$226 per cwt. delivered. One packer was buying for the second half of October delivery while the other packer was scheduling cattle for the first half of November delivery. U.S. packer interest was noted and depending on freight and dressing percentage, U.S. bids were working back to the mid-$130s per cwt. f.o.b. the feedlot.

For the week ending Sept. 26, western Canadian steer (944 pounds) and heifer (845 lb.) carcass weights are heavier than in Eastern Canada. Western Canadian steer carcass weights tied the old record set in November 2015.

In Eastern Canada, dressed sales and bids were reported in the low to mid $230s per cwt. delivered. The market tone was steady to weaker. Eastern Canadian fed slaughter totalled just over 11,000 head, 12 percent larger than last year and five percent larger than the five-year average.

Some fed cattle will start coming off the set-aside program, though volumes are not large. U.S. buying interest could be a factor this week.

In the United States, dressed fed sales in the north ranged from US$167-$168 per cwt., which was $2-$3 per cwt. higher than the previous week. Most of the live sales were reported from $106-$107 per cwt., which was $1-$2 per cwt. higher. Tentatively this could be the highest weighted average Nebraska price since early June. Weekly U.S. beef exports to China are running well above last year.

Cow bids lower

Non-fed prices were barely steady to softer last week on a generally moderate offering. Dressed cow bids aligned lower with reports from $160-$165 per cwt. delivered. Alberta slaughter cows at auction traded mostly steady last week with D2s at a $2 per cwt. premium to Ontario. D2s averaged $82.25 and D3s averaged $72.58 per cwt.

Butcher bull prices slipped $1 per cwt. lower than the previous week to average $110.69 per cwt.

Western Canadian non-fed slaughter for the week ending Sept. 26 was up 18 percent from the previous week to 5,997 head and year to date was down 24 percent at 230,176 head. Slaughter cow marketings should remain manageable this week and prices are anticipated steady. Auction offerings are expected to trend larger through October and prices are expected to be pressured lower.

Seasonal feeder demand

Alberta feeder prices eased modestly lower last week but good seasonal demand continued for all classes of feeders. Calves traded mixed last week with steer prices firming $1-$2.50 per cwt. higher than the previous week while heifer calves were around $2.50 per cwt. lower.

Calf prices strengthened from west to east again last week with 500 lb. steer calves in Manitoba trading at a $2 per cwt. premium to Alberta and Ontario at a $9.50 per cwt. premium. Ontario 800-900 lb. feeder steers last week saw average prices over $6.50 per cwt. higher than Alberta.

Alberta yearlings over 800 lb. traded unevenly last week with heifer prices steady to $1 per cwt. lower. Steer prices dipped more than $3.50 per cwt. lower. Total weekly auction volumes were sharply lower than the previous week and were two percent lower than the same week last year. Year to date auction volumes were down nine percent from last year at 818,660 head.

The U.S. Department of Agriculture reports that Canadian feeder exports for the week ending Sept. 19 were light at 952 head and were 19 percent lower than last year. Year-to-date feeder exports are down 47 percent, totalling 86,851 head.

Increased auction volumes are anticipated this week as fall run special calf sales get underway. Strong local and eastern feedlot demand will continue to be supportive and prices should trend steady. Yearling prices are also expected to trade steady on seasonally tighter supplies. Cow-calf pairs averaged $1,400-$1,800.

U.S. cutout steady

In U.S. beef trade, cut-out values traded steady with good demand observed for ribs and end primals. Choice averaged US$218.98 and Select averaged $207.62. Increased box movement was noted for Choice, Select and grinds, while weekly trim load count was slightly lower. Winter holiday buying is expected to gain momentum.

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