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 market disappoints
Fed prices have averaged slightly more than $186 per hundredweight over the past two weeks. For the first half of January, prices traded $2-$4 per cwt. lower than January highs seen in 2015. The market continues to be disappointing from both a basis and break-even perspective.
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On the basis side of the market, Alberta fed prices have been trading at a $22-$27 per cwt. discount against the U.S. market. For the first half of January this is the weakest basis on record going back more than 35 years.
Moving into the New Year, a lot of cattle have breakevens on either side of $200 per cwt. on a live basis, suggesting feedlot losses are still more than $200 per head with cash sales.
On a light test of the market, dressed sales were reported at mostly $312 per cwt. delivered. Cattle were scheduled anywhere from the week of Feb. 6 to Feb. 20 for delivery.
In Ontario, dressed sales ranged from $326-$329 per cwt. delivered, $2-$6 per cwt. higher than the previous week. Cattle were being booked for one to two week delivery.
In the United States, dressed sales in Iowa and Nebraska ranged from US$250-$252 per cwt., steady to $1 lower. Live sales in the southern feeding states were at $156 per cwt., also steady to $1 weaker. U.S. beef exports for November were down six percent compared to last year. Year over year, less beef was shipped to Mexico, Japan and China. Beef imports in November were down 19 percent compared to last year.
Brazilian beef imports to the United States were the smallest seen this year. Year-to-date beef exports are up five percent compared to last year, while beef imports are up two percent.
Cow price rises
Non-fed prices traded steady to stronger last week, with D2 slaughter cow prices surging $5 per cwt. higher to average $98.79 per cwt. D3 cows saw a moderate $2.50 per cwt. price surge to average $87 per cwt.
Dressed cow bids were fully steady in a wide $190-$200 per cwt. delivered trade range on an ample offering of various types. Alberta D2 cows traded at a $4 per cwt. premium to Ontario last week. Butcher bull prices eased modestly lower to average $124.10 per cwt.
Western Canadian slaughter for the week ending Jan. 7 totalled 9,310 head. Good demand is anticipated this week for non-fed slaughter cattle as post-holiday beef demand shifts away from middle meats to more affordable grind and trim. Slaughter cow prices are expected to trade fully steady.
Few feeders available
Feeding margins for large feeders are more profitable than calves, but seasonally few yearlings are available. Steer calf prices continued to rally sharply higher last week and a wide $58 per cwt. price spread developed between 550 lb. steer calves and 850 lb. yearlings.
With limited yearling offerings, the next best placement option for feedlots in Alberta and Ontario is 500-700 lb. steer calves. Significant price slides were observed for 500-800 lb. Alberta steers last week, while similar weight Ontario steers had none.
Last week’s 550 lb. steer/heifer price spread was also historically wide at $57 per cwt. With this large a spread, renewed interest in lesser-converting heifers is projected.
Anticipated tight grass cattle supplies fuelled early interest in calves less than 600 lb. last week, and prices rallied sharply higher. Post-holiday auction offerings resumed and volumes were nine percent larger than the same week last year at 24,872 head.
Canadian feeder exports to the U.S. for the week ending Dec. 31 were seasonally modest at 889 head. Total feeder exports will close the 2022 year 38 percent larger than 2021 at 198,565 head.
U.S. cut-outs mixed
In U.S. beef trade, cutouts ended last week mixed, with Select outperforming Choice. Select cutouts ended the week steady with the previous week at US$257.49 per cwt., while Choice cutouts were down 1.5 percent to $277.49. Current Choice cut-out values are among the highest since recording began and are the highest once COVID-related market shocks are removed.
