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.
Impressive fed market
Fed cattle prices have averaged in the mid to upper $250s per hundredweight for the past six weeks. The summer market has been impressive as prices are only $9/cwt shy of highs set in early June.
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To highlight its strength, for the first seven months of this year, western Canadian fed beef production is steady with a year ago, while year to date fed cattle prices are 11 per cent higher than last year. Producers are getting more dollars in their pockets for the same amount of beef and demand is strong.
Slaughter volumes have been slow to seasonally increase. For the week ending July 27, western Canadian fed slaughter totaled just over 42,000 head, one per cent below last year. For the end of July, this is the smallest slaughter since 2016. Despite lighter slaughter rates in Western Canada, fed cattle shipments to the U.S. continue to be historically large.
From lows in late May, western Canadian steer carcass weights have increased 33 pounds to be 12 lb. above year-ago levels. Despite that, Canadian yield grade 4 and 5 cattle remain par with last year at 6.3 per cent.
In Ontario, dressed sales were $420/cwt delivered, $5/cwt higher than the previous week. Ontario fed prices established new record highs. Ontario steer carcass weights at 975 lb. are only 7 lb. heavier than the low made in mid-May but remain 38 lb. heavier than last year.
In the U.S., dressed sales in Iowa and Nebraska were at US$310/cwt while live sales were at $196/cwt, $2/cwt lower. Sales in Texas and Kansas were at $188/cwt, steady to $2/cwt weaker.
In addition to geopolitical unrest in the Middle East, the market is also growing concerned about lighter slaughter rates, heavy carcass weights and consumer beef demand.
U.S. beef and dairy cow slaughter volumes continue to run below last year, pushing 90 per cent lean trim prices to record highs.
Cow prices strong
Non-fed prices were steady to stronger in the west last week, with Alberta D2 cows averaging $193.28/cwt. Alberta D3 cows climbed $5/cwt to above $182/cwt, re-establishing new all-time highs for the second time in the last eight weeks.
Alberta bull prices were steady with the previous week and have moved mostly sideways since the first half of June. Railgrade cows last week were fully steady with the previous week.
On a monthly basis, Alberta D2 cows averaged $188/cwt in July, almost $3/cwt softer than June. Alberta D2 cows were priced at a $6/cwt discount against U.S. Utility cows in July, whereas last year they were priced at an $11/cwt premium.
The market tone was mixed in Ontario. D2 cows closed the week $1/cwt stronger, and re-established new all-time highs for the fourth consecutive week. While Ontario D3 cows were $1/cwt softer, Ontario D2 cows strengthened $9/cwt in July to $172/cwt, and U.S. Utility cows were also C$2/cwt stronger, averaging C$194/cwt in July.
Auction action grows
Alberta auction market volumes were 20,612 head last week, three times larger than the summer low made four weeks ago. Volumes seasonally increase until October. Electronic sale volumes last week at 11,796 head were the third largest in the last decade for the same week and the largest weekly volume for the year.
Last week, heifer prices across all weight categories saw a rally from $1.27-$11.21/cwt compared to the previous week, while steer prices strengthened by $2.51-$6.89/cwt, except for the 600-700 lb. category, which traded $8/cwt softer.
In July, forward delivery sales for steers weighing 500-599 lb. for October and November delivery traded at $397/cwt and $417/cwt respectively. Last week steers in the same weight traded at $440/cwt.
For steers from 500-599 lb. for September, October and November delivery, prices were at $385/cwt, $370/cwt and $375/cwt respectively. In comparison, 600-699 lb. steers traded at $400/cwt. For the week ending July 20, feeder cattle exports to the U.S. were 2,031 head, down 37 per cent from last year. This is the smallest weekly export volume since January, excluding short holiday weeks. Year to date exports to the U.S. are at 91,997 head, up three per cent from last year.
Cutouts steady
In U.S. beef trade, Choice cutouts were fully steady with the previous week, at US$312.79/cwt. Select was one per cent stronger to $297.46/cwt. From a historical perspective, the summer low occurred during the second half of July.
