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 steady

Alberta direct cattle sales saw moderate volume trade last week with weighted average prices closing fully steady with the previous week. Most trade was reported dressed from $273-$274 per hundredweight delivered. Live trade ran from $161-$165 per cwt. Most cattle traded last week were scheduled for three to four weeks out.

Western Canadian fed slaughter for the week ending May 15 was one percent larger than the previous week at 41,081 head and year to date totalled 27 percent larger than the same week last year at 776,812 head.

Western Canadian steer carcass weights for the same week were 19 pounds lighter than the previous week at 877 lb. and were 23 lb. below year ago.

U.S. ready slaughter supplies are ample, and Canadian fed cattle/cow exports for the week ending May 8 slipped 21 percent lower than the previous week.

Most Ontario trade was reported at $255 per cwt. delivered, $3 per cwt. higher than the previous week. Fed supplies are beginning to moderate.

Lofty cut-out values have softened wholesale buying interest, and expensive beef is filling up the supply chain. Fed cattle price upside may appear limited, but feedlot managers have gained some market leverage from tightened market-ready supplies and carcass weights have dipped below a year ago.

In the United States, light to moderate live trade was steady to $1 per cwt. higher than the previous week at US$118-$120 per cwt. in the south and generally steady in the north from $119-$120 per cwt. Large slaughter supplies still need to be worked through.

Cow prices strengthen

Butcher cow prices have strengthened over the past five weeks by $7 per cwt., going from the low $90s to $100 per cwt. The last time butcher cows were trading more than $100 per cwt. was in July 2017. D2s averaged $100 and D3s averaged $87.80 per cwt.

Butcher bull prices have been disappointing relative to the cow market. Last week, butcher bulls traded $1 per cwt. lower. Canadian bull exports to the U.S. totalled 729 head, the third largest volume this year.

Many producers are only a few weeks away from turning cattle into summer pastures. This could result in a small flush of calving culls. In 15 of the past 20 years (not counting last year), D2 cow prices have dropped from May to June.

Canadian beef imports (January to March) from New Zealand are up 30 percent year over year.

Auction volumes stabilize

Since the start of the year, auction volumes have been running higher than last year. With larger calf and feeder marketings over the past few months, supplies are starting to seasonally taper off. Last week marked the first time since early April that Alberta auction volumes were below last year.

More heifers are coming to town compared to steers, which is normal for this time of year. In some cases heifers are making up 60 to 75 percent of the total offering.

Since the second half of April, calves and lightweight stockers have dropped from $5 to $10 per cwt., while heavier feeders are steady to a couple dollars lower. Seasonally there is a better chance of seeing heavier feeder cattle prices rally over the next 30 days compared to the calf market.

So far in May, Alberta 550 lb. steers have averaged a $33 per cwt. premium against the U.S. market compared to a $6.25 per cwt. premium last year.

Demand for pairs and bred stock remains decent, but producers are cautious. Rain across parts of the Prairies last week boosted optimism but some areas are still dry. Last week, cow-calf pairs averaged $2,250 per head with sales reported up to $3,100 per head. Sales hitting more than $3,000 are likely first calvers with late winter or early spring calves at side. Last week, bred cows traded from $1,500-$2,050 per head.

Cutouts continue rally

In the U.S. beef trade, cut-out values continued to rally despite softer buying interest. Choice has now strengthened for nine weeks in a row, up US$7.40 per cwt. from the previous week to average $324.18 per cwt. Select averaged $301.61 per cwt. Total U.S. slaughter last week was estimated at 669,000 head.

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