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 cattle market down
The Alberta dressed trade range last week was comparable with the previous week from $388-$393 per cwt. delivered. More cattle were procured at $388 per cwt. delivered, and the weighted average price was pressured almost $2 per cwt. lower. Weighted average steer prices have now slipped lower for eight straight weeks, down more than $15 per cwt., the lowest since May 12.
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Western Canadian fed slaughter for the week ending Aug. 12 eased 10 percent lower than the previous week to 36,243 head. Year-to-date western fed slaughter was 1,280,896 head, down seven percent compared with the same week last year.
The 2023 cash market is expected to struggle through the remainder of August, but it should gain modest momentum through September as supplies tighten.
In the U.S. fed market, scattered light southern live trade was around $1-$3 per cwt. lower with the previous week at $177-$179 per cwt. Northern live trade was $1-$2 per cwt. lower than the previous week at $186-187 per cwt.
Dressed sales were steady to $3 per cwt. lower than the previous Nebraska rail average with most sales from $292-$295 per cwt. delivered. U.S. steer carcass weights for the week ending Aug. 5 were steady with the previous week at 895 pounds and were three lb. heavier than a year ago. Total U.S. slaughter for last week is estimated two percent larger than the previous week at 616,000 head and seven percent lower than a year ago. National boner cow prices were generally steady last week to average $217.33 per cwt. dressed.
More cows to slaughter
Demand for bred cows remains limited, and most if not all the exposed cows are going to slaughter. In addition, many cow and calf pairs are also being split at auction, adding a few more cows to the slaughter mix. After trending lower over the past four weeks, cow prices were reported $3 per cwt. higher last week, while butcher bull prices strengthened $1.75 per cwt.
Non-fed prices are currently trading $5-$7 per cwt. shy of their highs set back in June. Over the past month, Alberta cow prices have gone from a $10 per cwt. premium to the U.S. market to a $4 per cwt. discount.
Alberta D2 cows averaged $150 per cwt., while Ontario D2s averaged $137 per cwt. Alberta D3s were at $134 per cwt. and Ontario D3s averaged $113 per cwt. Alberta slaughter bulls averaged $159 per cwt.
Over the past month, western Canadian cow slaughter volumes have been steady at 6,000 head per week. This is four percent larger than last year and nine percent larger than the five-year average.
Feeder market strong
The past few weeks have seen higher prices and new annual highs. Last week’s auction volumes totalled more than 47,000 head, but 80 percent were electronic and video calves and feeders. There was a good mix of background feeders and grass yearlings. Backgrounder cattle are trading at roughly a $8-$12 per cwt. discount compared to cattle coming off grass. Based on historical data, when buying an 850 lb steer in August and targeting the February fed market over the past five years, the average feeding margin is $154 per head negative, and the 10-year average is $32 per head negative. The same scenario for an 850 lb. heifer yields a five-year margin of $107 per head negative and a 10-year positive average of $7 per head, assuming no risk management.
In overseas markets, China’s removal of tariffs on Australian barley should moderate export demand for Canadian barley. Western Canadian barley prices have dropped around $30 per tonne. Barley delivered into southern Alberta is being booked from $360-370 per tonne.
Last week, Alberta and Saskatchewan six-weight steers for October delivery traded from $355-370 per cwt., with a weighted average price of $364.19 per cwt. based at 634 lb. On average, forward delivery sales for October delivery are looking roughly $2 per cwt. lower compared to sales during the first half of August.
U.S. cutouts climb
In U.S. beef trade, Choice cutouts jumped four percent to $314.14 per cwt., and Select cutouts climbed three percent to $286.26 per cwt. The rally this summer is reminiscent of 2021 when there were two distinctive peaks.
