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 prices steady

Alberta direct cattle sales saw light to moderate volume trade last week with average steer prices fully steady with the previous week and heifer prices realigned higher. The bulk of last week’s trade was dressed at $223 per hundredweight delivered. Repeatable dressed trade was reported to the United States last week at US$175 per cwt. delivered. U.S. bids worked back to C$136 per cwt. f.o.b. the lot at 63 percent to provide a modest premium and a shorter one- to two-week delivery window.

For the week ending Oct. 31, western Canadian fed slaughter was 10 percent lower than the previous week at 43,008 head, and year-to-date was down two percent at 1,734,060 head. Canadian steer carcass weights for the same week were 13 pounds lower than the previous week’s all-time record high of 961 lb. and were eight lb. heavier than the same week last year at 948 lb.

Ontario fed trade last week was reported from $228-$231 per cwt. delivered with the bulk of sales for one- to two-week lift at $228 per cwt. delivered.

Cut-out values are expected to gain momentum on improved holiday buying demand and market-ready supplies tightening. Large carcass weights will remain antagonistic, and conditional weight breaks are anticipated.

Remembrance Day will shorten the kill week, and one major plant is doing minor cooler maintenance. Saturday shifts could be added to make up for the holiday.

In the U.S., prices in the south were around $1 per cwt. higher than the previous week from US$106.75-$107.25 per cwt. Scattered live trade in the north was generally $1-$3 per cwt. higher than the previous week’s Nebraska average from $105-$107 per cwt. Dressed sales in the north were reported in a wide $160-$167 per cwt. delivered trade range, steady to $7 per cwt. higher than the previous week’s Nebraska rail average.

U.S. steer carcass weights for the week ending Oct. 24 were reported record high at 931 lb.

Cows reach new low

November is traditionally a tough month for the non-fed market, and this year is no exception. Larger volumes of non-fed cattle have started to appear at commercial auction facilities and simply put, larger supplies are outpacing demand.

Western Canadian cow slaughter for the week ending Oct. 31 totalled 5,521 head, 27 percent lower than last year. Margin wise, packers are seeing greater value in fed cattle and not ramping up their cow slaughter.

Trading $2-$3 per cwt. lower last week, new second half lows were established for cull cows. D2s averaged $69.33 and D3s averaged $59.88 per cwt. For the beginning of November it was the lowest cow price since 2012.

Over the past month, D2 cow prices have dropped $10 per cwt. and as a result Alberta cow prices have moved from a premium to now a $5+ per cwt. discount against the U.S. market. If slaughter volumes don’t pick up in Western Canada, Alberta cow prices could remain at the export floor of the U.S. market and more cows could end up being exported.

Ontario butcher cow prices traded fully steady last week. The slaughter situation is much different in Eastern Canada compared to the West. Eastern Canadian cow slaughter totalled 2,455 head, the biggest slaughter this year.

Feeder price rebounds

Calf prices rebounded last week, regaining everything they lost over the previous few weeks. Totalling more than 87,000 head (electronic and ring), Alberta is working through peak auction numbers. Even though volumes have been brisk, over the past four weeks total auction receipts are down 48,500 head compared to last year.

The Alberta-Saskatchewan cattle-on-feed report is scheduled to be released this week, and October placements might be below last year. Spot barley prices are at the highest point since July 2019 and are trading 17 percent higher than a year ago.

In Ontario, corn prices have moved off their recent highs but are trading two percent lower than last year. Ontario 550 lb. steers averaged $221.68 per cwt., $1.50 per cwt. higher than the five-year average, whereas Alberta-Saskatchewan calf prices are trading $12-$14 per cwt. below the five-year average.

Eastern Canadian buyers were active on the western Canadian calf market last week. On a cash-to-cash basis, Alberta calf and feeder prices continue to trade at a premium to the U.S.

For the month of October, Alberta steer calves (550 lb.) averaged a $11.25 per cwt. premium against the U.S. market compared to a $15 per cwt. premium last year. Alberta feeders (750 lb.) for October averaged a $10.25 per cwt. premium compared to $13.25 per cwt. last year.

Even though Alberta calves and feeder prices are trading at less of a premium year over year, it might still be advantageous to import U.S. cattle. Last year Canadian calf and feeder imports from the U.S. for the month of October totalled more than 46,000 head.

Calf and feeder prices have weathered the storm better than expected in light of high barley prices, continued losses from the finishing segment and delayed fed marketings (long lift times for fed cattle and the set-aside program).

U.S. cutout rallies

In U.S. beef trade, cut-out values rallied higher last week with generally good demand for all beef primals. Choice averaged US$212.55 and Select averaged $198.97.

Winter weather reduced slaughter shifts in the south two weeks ago, and last week U.S. cattle slaughter was expected to rebound larger to 647,000 head. Good holiday buying demand is expected this week, but ample supplies of pork and poultry may be competitively featured.

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