This cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattle Association. More market information, analysis and statistics are available by becoming a Canfax subscriber by calling 403-275-5110 or at www.canfax.ca.
Low basis seen
The western Canadian fed market continues to underperform relative to the U.S. and Ontario markets. Last week dressed sales were reported from $365-$368 per hundredweight delivered. Light volumes of western Canadian fed cattle were marketed into the United States priced off the five-area average. Last week’s Alberta fed cash-to-futures basis was reported at -$27.80 per cwt. For the beginning of February, this is the weakest in the past 38 years.
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Western Canadian fed slaughter for the week ending Feb. 3 totalled just over 41,000 head, 10 percent larger than last year.
Canadian fed beef production was 48.1 million lb. For the end of January and beginning of February, fed beef production is record large. Quality grading percentage continues to impress with cattle grading Prime just over seven percent, close to a new record high.
In Ontario, dressed sales ranged from $389-$395 per cwt. delivered, $4-$5 per cwt. higher than the previous week.
With high breakevens and historically weak basis levels, producers are expected to keep fighting the market by adding additional weight to cattle in hopes of a price bounce.
In the U.S., live sales in southern feeding states were at US$182 per cwt. Dressed bids were at $287 per cwt., $7 per cwt. stronger. Northern states saw low trading volume.
U.S. beef exports for December were six percent lower than last year. In 2023, total beef exports were down 14.6 percent compared to 2022. Less beef was shipped to Japan (-22.4 percent), South Korea (-18.1 percent), and China (-19.7 percent) compared to last year.
Over the past year, the bright spots for U.S. beef exports were Mexico and Hong Kong with exports up 11.8 and 14.3 percent, respectively.
Cow prices rise
Alberta D2 cows climbed $1.89 per cwt. to $132 per cwt. and are up nine percent since the beginning of the year. The historical five-year average shows a 35 percent rally from early January to the spring peak. Alberta D3 cows were up $8.66 per cwt. to $118.79 per cwt. and are up 11 percent since the start of the year.
Alberta butcher bulls were up $2.58 per cwt. to $153.14 per cwt. and are now up $11 per cwt. since the start of the year. Bull prices typically rally between February and June.
Canadian slaughter volumes for the week ended Feb. 3 totalled 62,295 head, down 11 percent from the previous week. Cow slaughter increased three percent, while bull slaughter increased by 22 percent compared to the previous week.
Steer price rallies
Alberta auction volumes totalled 20,553 head, showing increased activity in northern and southern Alberta but a decrease in the central region, resulting in a 26 percent drop compared to the previous week. However, when compared to the five-year average, there was a modest five percent increase.
Last week there was a positive rally across all steer weight categories. Alberta 500-600 lb. steers were up $7.58 per cwt. to $412.88 per cwt., setting a new high. Alberta 800-900 lb. steers climbed $6.33 to $306.60 per cwt., with the 850 lb. feeder basis strengthening $1.91 per cwt. to -$25.41. However, when compared to the five-year average, it remains $18 per cwt. wider, indicating weaker market interest on heavyweight steers.
Alberta 400-500 lb. heifers surged $24 per cwt. to $373.71, the largest rally since the start of the year. Alberta 800-900 lb. heifers were up $8.26 per cwt. to $284.43.
Ontario 500-600 lb. steers were up $26.80 per cwt. to $393 per cwt. These lightweight 550 lb. steers have been on a strong rally since the start of the year, up $81 per cwt. when compared to the first week of 2024, putting it close to the historical high of $396 per cwt. in September 2023.
Heavyweight 800-900 lb. steers were up $10.28 per cwt. to $315.37, up $25.70 per cwt. since the start of the year.
Ontario 400-500 lb. heifers were up $11.96 to $308.10 per cwt. compared to the previous week. Heavyweight 800-900 lb. heifers softened by $3.29 to $264.26 per cwt., the first time it has softened since the start of the year.
Cutout values healthy
In U.S. beef trade, cut-out values followed closely with the five-year average throughout January. Choice averaged US$295.01 and Select averaged $284.12.
