Fed price finally falls
The Canfax weighted average price of steers was $165.28 per hundredweight last week, down $2.
It was the first time in 11 weeks that prices fell.
Most dressed sales were at $280 per cwt. delivered.
Fed cash prices in the United States fell by $3-$4 per cwt. as packers slowed slaughter and turned to contracted cattle supply.
Chicago futures fell on the weakness in the cash market and on worries about Russia’s ban on food imports from most western countries.
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The United States sells almost no beef to Russia, but the development provided an argument to drive prices lower after setting many record highs.
Some analysts expect the Russia issue to be a temporary tempest and trading to return to reflecting the tight supply and demand fundamentals.
The weekly Canadian cash-to-futures fed basis was strong at -$5.72.
Western Canadian fed slaughter for the week ending Aug. 2 fell nine percent to 32,535 head.
Weekly exports to the U.S. to July 26 rose three percent to 5,047 head.
Cows set record
Cow prices jumped again with D1, D2 ranging $120-$137 to average $128.30 per cwt., up almost $3. D3 cows ranged $105-$120 to average $115.50, up $4.83.
Non-fed exports to the U.S. are down but slaughter, at least near term, is not anticipated to increase.
Recent western Canadian cow slaughter has ranged 5,100-5,500 head. Butcher bulls traded at $137 per cwt., up $4.56.
Canadian D1, D2 cows are now trading at only a $1.50 discount from U.S. utility cows. Prices could be due for a correction lower.
Feeders stronger
Feeder prices rose with strong demand for all classes.
With the August holiday and many auctions running bi-weekly or monthly sales, volumes were too light to establish a weekly accurate price trend outside of Alberta.
The vast majority of calves on offer were steers. Owners are retaining heifers for the time being.
As the yearling run begins, buyers and sellers are wondering what cash market supplies will be available over the next 60 days.
More cattle have been forward priced this year. Steers 725-775 pounds in Alberta and Saskatchewan for September to October delivery were reported at $230-$237 per cwt.
Weekly exports to July 26 totalled 970 head, the second lowest volume this year. The weaker feeder futures could lower the cash market this week.
Cow-calf pairs traded at $1,800-$2,800.
U.S. beef down
U.S. Choice cutout fell $1.25 US and Select was down $5.34 over the week.
Typically, boxed beef prices strengthen into mid-August with grilling demand for Labour Day, but with prices already so high, a rally is less likely.
Canadian cutout values for the week ending Aug. 2 saw AAA at $268.98 Cdn and AA at $260.67.
Data for the week ending July 26 was not available.
Compared to the week ending July 19, AAA was up $6.21 and AA was up $4.98.
Canadian price gains lagged the U.S. market and the AAA-Choice spread sharply widened to -$21.69 Aug. 2 from -$6.31 July 19.
