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 hold range

The fed market has gained a little momentum over the past couple of weeks, but prices have failed to break out of the 20-week trading range of $113-$137 per hundredweight. Last week, dressed sales were reported from $228-$229 per cwt. delivered. Packers were buying cattle for the second half of December and early January delivery.

U.S. buying interest was reported at US$182 per cwt. delivered, depending on freight and dressing percentage. U.S. bids were working back to the upper $130s per cwt. f.o.b. the lot. Even though U.S. bids were at a premium over local deals, weight breaks of 1,050 pounds deterred sellers from sending cattle south and all cattle traded locally.

For the week ending Nov. 21, western Canadian fed slaughter totalled 50,154 head, the second largest slaughter seen this year. For the second half of November this is the largest since 2004. With heavier longer fed cattle coming down the line, quality grades continue to impress. Canadian Prime and AAA grading as a percentage of all A grades was reported at 73.14 percent compared to 72.54 percent last year, and the five-year average of 70.02 percent.

In Ontario, dressed sales were reported at mostly $232 per cwt. delivered, steady with the previous week.

In 15 of the past 20 years, fed prices have increased from November to December. The average increase over those 15 years stands at four percent. Using an historical increase, this would put fed prices on track to average in the low $140s per cwt. for December.

Most of the fed cattle now being marketed are either 2019 fall-placed calves or 2020 spring-placed feeders. Summer-placed yearlings are probably one month away from hitting the market. Few if any summer-placed yearlings are likely to be pulled forward and sold ahead of schedule, given that many yearlings were bought with breakevens in the low to mid $150s per cwt.

In the United States last week, dressed sales in the north ranged from US$172-$174 per cwt., steady to $2 per cwt. higher than the previous week. Live sales in the south were reported from $110-$111 per cwt., steady to $1 per cwt. higher.

The U.S. dollar continues to trade lower, which is positive news for protein and general commodity exports. For the week ending Nov. 21, U.S. imports of Mexican feeder cattle totalled 37,083 head. Year to date, imports are up 12 percent compared to last year.

Cow prices rise

Non-fed prices firmed modestly last week on improved year-end grind demand. Slaughter cows at auction saw prices around $1 per cwt. higher, while dressed bids continued at $135-$140 per cwt. delivered. D2s averaged $6960 and D3s averaged $59.10 per cwt.

Butcher bull prices strengthened $1.23 per cwt. higher than the previous week to an average of $99.50 per cwt. Most of last week’s momentum was packer interest for immediate slaughter, and interest in feeder cows appears to have softened.

Western Canadian non-fed slaughter for the week ending Nov. 21 surged 66 percent higher than the previous week to a respectable 8,317 head. Slaughter cow prices are expected to strengthen modestly but will likely moderate in the new year. A light offering of bred cattle saw good demand last week with cows averaging $1,662 per head, and bred heifers saw prices higher than $60 per head, stronger than year ago and averaging $1,995 per head.

Mixed calf demand

Feeder cattle prices eased modestly lower last week with mixed demand observed for calves. Light steer calves lighter than 500 lb. traded slightly stronger than the previous week, while similar weight heifer calves traded steady to lower. Middleweight calves from 500-700 lb. traded unevenly with steers slipping around $2 per cwt. lower and heifers trading generally steady.

Ontario 500-600 lb. calves were trading at a modest $1.50 per cwt. premium to Alberta last week, but good Ontario buying interest was observed for preconditioned calves. Feeders heavier than 700 lb. traded from $1 per cwt. stronger to $3 per cwt. lower as buyers selectively chipped away to fill year-end tax orders.

Auction volumes were 21 percent lower than the previous week but were fully steady with the same week last year. Year to date, auction volumes are 10 percent below the same week last year, totalling 1,355,690 head.

The U.S. Department of Agriculture reports that Canadian feeder exports for the week ending Oct. 31 were slightly larger than the previous week at 3,307 head and were significantly larger than the same week last year. Year to date, feeder exports are 40 percent below a year ago at 106,772 head.

Alberta 500-600 lb. steer calf prices two weeks ago rebounded fully steady with the same week last year but last week were $1.50 per cwt. below a year ago. In 2019, 500-600 lb. steer prices firmed around $3 per cwt. higher through December. However, the five- and 10-year historic averages indicate prices typically slide $1-$2 per cwt. lower.

U.S. cutouts jump

In U.S. beef trade, cutouts rallied more than $7 per cwt. higher last week ahead of the Thanksgiving holiday with general strength across the entire carcass. Choice averaged US$245.06 and Select averaged $220.90 per cwt.

Last week’s total U.S. cattle slaughter at 564,000 head was smaller than the previous week, mostly because of the Thursday holiday.

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