Fed cattle rally
On July 14 a U.S. appeal court struck down the injunction blocking Canadian cattle imports and Canadian cattle sellers started exporting south this week.
Expectation of a favourable ruling had pushed slaughter and feeder prices higher for several days and fed averages last week were $1.75-$2.50 higher than the week before, Canfax said.
The strong market encouraged deliveries, with volume reported by Canfax members at 33,000 head, 34 percent larger than the week before.
Trade started slow as buyers and sellers waited for the court’s ruling.
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By noon July 13 it became apparent that all packers needed cattle and the market started to rally.
Alberta prices July 14 were steers $82-$87.60 per cwt., flat rail $141.85-$144 and heifers $84.25-$87.35.
Cattle offered last week with a slaughter date of July 21 (set-aside release) traded at the lower end of the range.
The set-aside auction results saw 108 participating bidders and the weighted accepted average was $1.22, down from $1.29 the previous week. Cattle were accepted from Alberta and Ontario.
Given the large volume traded, feedlots are current in their marketing. This, combined with the preliminary injunction being overruled, will strengthen producers’ bargaining
positions, Canfax said.
However, an on-going labour dispute at Tyson in Brooks, Alta., could change slaughter rates, Canfax said. Also, additional scheduled court hearings add another layer of uncertainty.
Beef prices rise
Due to holiday disruptions, the Canadian cut-out values are not available.
Wholesale prices trended higher with the Calgary market for delivery this week at $142-$146 per cwt., an increase of $1-$4 from the previous week.
The U.S. market saw the Choice cutout fall $2 US from the previous week and the Select cutout dropped $3.25 on larger volumes.
Canadian packers should be slaughtering a full kill this week.
Feeders rise
The strong fed cattle market contributed to feedlots’ willingness to refill pens, Canfax said. This, coupled with speculation about the border, kept prices steady to higher.
Stronger prices helped draw out cattle, with volume up 42 percent from the previous week at about 15,300 head, which was almost double last year’s pace.
Steers 600-800 lb. were steady to $1.50 Cdn higher than the previous week, while steers 800-900 lb. and heavier rose $1.25-$1.50.
Heifers 600-800 lb. were 50 cents-$2 stronger and 800-900 lb. and heavier were $3.25-$3.50 higher.
D1, 2 slaughter cows gained $1.25 and butcher bulls were steady at $22.50.
The feeder market will be sensitive to U.S. market news. Demand is expected to continue strong, but the border news will determine buyers’ aggressiveness. Volumes are expected to continue at seasonal lows, Canfax said.
Stock bred cows in central Alberta were $500-$1,150, depending on age and quality.
Most cow-calf pairs were $700-$900, with tops up to $1,100.
U.S. situation
The U.S. cattle market fell after the court reversed the injunction, but it was already falling because of a large supply of cattle on feed for 120 days or more, rising carcass weights, falling beef prices and rising corn prices.
Hogs mostly steady
Pork prices in the United States climbed last week but packer margins were still in the red so packers slowed slaughter rates to keep pressuring down hog prices.
However, hot, humid weather in the U.S. halted hog weight gains, allowing sellers to stay out of the market.
The Iowa, southern Minnesota cash price for hogs delivered to plant July 15 was $50 US, compared to $49 the week before.
The U.S. Department of Agriculture composite pork cut-out value July 15 was $69.26 based on a 185 lb. carcass, 51-52 percent lean. On July 8 it was $66.22.
Chicago hog futures fell, in part because traders think resumption of Canadian cattle imports will lower beef prices and reduce demand for pork.
Sheep prices rise
Ontario Stockyards reported 2,015 sheep and lambs and 149 goats traded last week. Light lambs sold at barely steady prices, while heavies were fully steady. Sheep traded $5-8 Cdn cwt. higher. All classes of goats held firm.
