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 price firms
Alberta direct cattle sales saw moderate volume trade last week, with weighted average steer prices firming $3 per hundredweight higher than the previous week. The bulk of sales were reported dressed from $315-$317 per cwt. delivered.
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Local live trade was reported comparable with rail sales at $187.75 per cwt. A significant portion of last week’s cash offering traded south at US$240 per cwt. delivered and worked back to around a $190 per cwt. f.o.b. the feedlot live equivalent.
Western Canadian fed slaughter for the week ending Jan. 14 rallied three percent larger than the previous week to 40,893 head and year to date is 11 percent larger at 80,651 head.
Fed cattle/cow exports to the U.S. for the first week of 2023 were moderate at 8,563 head. Pending revisions, total export volumes for 2022 were 18 percent larger than 2021 at 754,151 head.
The Ontario cash market firmed $2 per cwt. higher than the previous week, with the bulk of sales reported at $328 per cwt. delivered.
As cash market supplies tighten, packers will likely slow the kill and focus on ample formula priced inventory.
Recent cash basis strength will likely shift Pacific Northwest buying interest away from western Canadian and towards the eastern U.S. Monthly Alberta fed prices have only strengthened three out of the past 10 years from January to February, and five out of the past 10 years from February to March. Seasonally lackluster wholesale beef demand is anticipated and cash market upside will be limited until spring beef demand improves.
In the U.S., stormy weather in the Midwest and northeast disrupted trade and sale volumes. Over-bought cattle futures also pressured the cash market lower last week but thin southern live trade was reported US$1 per cwt. lower than the previous week at $155 per cwt. Light northern live sales were steady to $1 lower from $155-$156 per cwt.
Scattered dressed trade was generally $2-$3 per cwt. lower than last week at $248 per cwt. delivered.
Cow prices rise
Butcher cow prices have moved higher for five straight weeks, advancing $15 per cwt. D2 cow prices are trading around $100 per cwt. For January, this is the highest price since 2016.
Alberta cow prices are still trading at a discount to the U.S. utility cow market, but the price spread has narrowed. In December, Alberta cow prices were trading at roughly $14 per cwt. discount, whereas now the discount is closer to $5 per cwt.
Western Canadian cow slaughter volumes have been strong. Over the previous two weeks, western Canadian cow slaughter has averaged over 9,000 head per week. Compared to the first half of January, non-fed volumes through commercial auction facilities have started to tighten.
Since the start of the year, Ontario cow prices have been flat, averaging in the mid $90s per cwt. In the U.S., 2022 beef cow slaughter was the largest since 1996. Some projections for 2023 indicate U.S. cow slaughter volumes could be down as much as 15-20 percent year over year.
Feeder market strong
Calf and feeder prices have started January on a strong note. Compared to December, the biggest price advancement has been on 400-700 pound steers, with prices up $17-$24 per cwt. On the flip side, the smallest price gains from December have been 900 lb.+ heifers as prices are up $2 per cwt. Over the previous two weeks, 500-600 lb. steers have averaged on either side of $300 per cwt., the highest price since September 2015.
Alberta 850 lb. feeder cash-to-futures basis was reported at +$1.58 per cwt., stronger than last year and stronger than the five-year average. Most of the bigger weight feeders purchased now will be priced against the August live cattle contract, which is trading at a slight premium against the June 2023 contract.
The forward delivery market was lightly tested, and prices are at record high levels. Last week 900 lb.+ heifers in Saskatchewan for July delivery traded in the mid $230s per cwt.
U.S. cutouts weaken
U.S. cutouts trended steady to slightly weaker this week, following seasonal norms. Choice cutouts fell 2.2 percent to US$271.51 per cwt. and Select cutouts fell a slight 0.7 percent to $255.69 per cwt. Cutouts remain 15-19 percent above the five-year average.
