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.
Beef prices up
Dressed prices were steady to $3 per hundredweight higher in moderate volume trade for the week ending Feb. 17.
The bulk of sales were reported dressed at $328 per cwt. delivered. U.S. buyers obtained Canadian cattle on the five-area average. Cash sales were reported at US$250 per cwt. delivered, which works back to about $199.50 per cwt. f.o.b. the feedlot live equivalent.
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Alberta fed steers ended up $2.29 to $196.39 per cwt. There wasn’t enough heifer trade to establish a trend.
Western Canadian fed slaughter for the week ending Feb. 11 realigned 14 percent larger than the previous week at 45,935 head, and non-fed slaughter dropped by four percent.
Year-to-date western fed slaughter was just two percent larger than a year ago at 250,762 head.
Steer carcass weights were 12 pounds lighter than the previous week at 940 pounds but still seven lb. bigger than the same week last year.
Ontario steer trade was light and $2 to $4 per cwt. higher at $332 per cwt. delivered. Heifer volume was lighter and did not establish a weekly trend. However, a few went south at US$254 per cwt. delivered.
U.S. buying interest is anticipated again this week. Feedlots are expected to shuffle market-ready inventory to fill contracts, and supplies are trending cautiously current. Feeders should maintain moderate leverage moving forward, and prices are once again expected steady to stronger.
Western non-fed prices have been moving in the same direction all year. They have been disappointing relative to the fed market. Butcher cows traded $1.50 to $2 per cwt. higher, and prices are at their highest since early September. D2 cows averaged $105.50.
However, the last time fed cattle prices were trading in the current range, cows were in the low $140s per cwt.
Slaughter volumes remain historically large for cows, but some report packers are reducing D grade hours as non-fed supplies continue to tighten.
In the East, cow prices last week dropped $5 per cwt. Year-to-date eastern cow slaughter was slightly more than 15,500 head, the largest volume since 2012.
Feeders stay high
Feeder prices remain in line with the record highs of 2015. Last week calf and heavier weight feeder prices moved opposite. The price spread between a 550 lb. and an 850 lb. calf is $67.50 per cwt., at $313.80 and $246.36, respectively. This is the largest spread in seven years. Historically the widest spreads occur in late April and early May. In 2015 year the spread peaked at $85 per cwt.
Alberta 900 lb. and heavier heifers for September delivery traded in the low $240s per cwt. That’s $8 to $10 higher than a few weeks ago. Using a 10-cent price slide, the adjusted 850 lb. heifer basis for September delivery is around -$27 per cwt. The historical basis is closer to -$16.
Although basis levels are weaker, forward delivery prices are sitting $10 per cwt. higher than the 2015 high.
Barley prices have dropped about $20 per tonne the last couple of weeks. Steady to higher calf prices are expected this week.
A small number of bred cows traded from $1,525 to $2,600 per head last week, about $400 per head higher than last year. Prices are strengthening but still disappointing.
Cattle on feed drops
The Feb. 1 cattle-on-feed report issued Feb. 17 notes that aggressive marketing and lower feedlot placements contributed to 38,000 fewer head on feed from the previous month. Total inventory on feed was 1.05 million head, six percent lower than last year, but the sixth largest number for this date since reporting began in 2000.
Auction volumes down
January auction volumes in the West were down 9,000 head, and feedlot placements were 124,000 head, or five percent lower than last year. Eastern buyers, who are usually active on feeders heavier than 800 lb., did not show as much demand as last year. Heavier weight feeders are staying in the West.
Cutouts up
U.S. cut-out prices popped last week with Choice cutouts up 3.8 percent to $279.55 per cwt. and Select up 3.4 percent to $262.64 per cwt. The spread continues to widen and is about $17 per cwt. Typically, a spread this wide doesn’t happen until early May.
