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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 steer prices drift lower

Alberta direct cattle sales saw moderate volume trade last week with weighted average prices closing $2.28 and $3.14 per hundredweight lower than the previous week for steers and heifers, respectively. Dressed prices were generally $3-$4 per cwt. lower than the previous week’s rail average in a full $258-$263 per cwt. delivered trade range.

For the fourth week in a row, average steer prices have eased seasonally lower, but prices last week were eight percent stronger than the five-year average.

Western Canadian fed cattle slaughter for the four-day week ending July 3 was 18 percent smaller than the previous week at 39,134 head. Year-to-date western fed slaughter was 19 percent larger, totalling 1,071,238 head.

Canadian fed cattle/cow exports to the United States for the week ending June 26 were mostly steady with the previous week at 4,114 head and are 57 percent lower than the same week last year. Year-to-date exports were down 21 percent to 204,504 head.

Scattered Ontario trade was reported steady with the previous week at $270 per cwt. delivered, with a handful of steers trading at $273 per cwt. delivered. Packer interest was lacklustre.

Cutouts should continue to seasonally soften heading into the summer doldrums, and buyers will gain additional leverage. Fed prices are expected to lose momentum and there is little incentive for feedlot managers to fight the market or make cattle bigger. Beef at retail is being aggressively features, and lower pricing could make domestic beef more competitive.

In the U.S., northern live trade was reported from $123-$125 per cwt., steady to $2 per cwt. lower than the previous week’s live average.

Drought brings cows to town

In the non-fed cattle report, no sales were held July 1-2, and small volumes were noted last week. Drought pressure continues to be evident, and more cow-calf pairs and non-fed cattle are on the market compared to what would normally be on offer for this time of year.

From their first half of the year high in mid-June, butcher cow prices have dropped $5-$8 per cwt. D2 cows averaged $94.67 per cwt. and D3s averaged $84.33.

June was a big cow slaughter month for Western Canada. Cow slaughter totalled more than 28,000 head, the largest volume since 2010. Year to date, Canadian bull exports are down 22 percent compared to last year with fewer bulls exported to the U.S. and more being slaughtered in Canada.

Year to date, bull slaughter is up 90 percent from last year. Western Canadian bull slaughter totalled 1,533 head over the previous three weeks, the largest three-week running total since December 2011.

Feeder auction volume down

Over the past five weeks, total Alberta, Saskatchewan and Manitoba auction volumes have been down 20,000 head from last year despite dry conditions, and feeder and calf prices have generally been higher than last year. Auction volumes were light last week and prices were steady to lower.

There has been a good mix of grass yearlings and background feeders trading on the cash market. In general, grass cattle are trading at a premium over backgrounded feeders. In some areas lighter fleshed steers coming out of background lots are not trading at much of a discount compared to grass cattle. The largest price difference is showing up on heifers.

Alberta feeder basis levels weakened last week, going from -$5.62 per cwt. to -$9.84, the weakest basis in nearly one year. Volumes have been light, but some heifers that have been exposed for 30 plus days are trading on the feeder market. Most are going to feedlots.

For the month of May, U.S. feeder cattle imports totalled slightly more than 33,000 head, 84 percent larger than last year. Feeder import volumes from January to May 2021 have been record breaking for each of their respective months.

U.S. cutouts decline

In U.S. beef trade, cut-out values continued to decline last week on generally softer demand and ample supply. Choice dipped US$5.50 per cwt. lower to average $281.97, and Select slid almost $7 per cwt. lower to average $260.06 per cwt.

Total U.S. slaughter for the American holiday week was estimated at seven percent smaller than the previous week and 10 percent lower than a year ago at 582,000 head.

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