Beef exports up from 2002
Fed cattle prices rose again last week with averages up $3.50-$4.75 per hundredweight. The gains came Jan. 14 and 15.
Ironically, although markets are upset due to bovine spongiform encephalopathy, exports of Canadian beef to the United States and Mexico soared in the last week of 2003. Beef exports to Mexico during that week were 11.68 million pounds, an increase of 400 percent over the same week the year before, said Canfax.
The U.S. bought 26.82 million lb., more than double the previous week and more than double the same week in 2002.
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The exports helped keep Canadian packers busy. They slaughtered 67,000 head two weeks ago and last week were willing to pay to get more supply.
More than 29,000 head were sold through Canfax members, an increase of 64 percent over the week before. Producers were willing sellers at the higher prices.
High yielding cattle tended to be at the top end of the price ranges.
Alberta prices Jan. 15 were steers $81-$84 per cwt., flat rail $137.20-$139 and heifers $81.50-$86.10, flat rail $139.
For the short run, trade patterns are not expected to change and prices are expected to hold the ground they’ve gained, said Canfax.
Wholesale beef prices this week are higher, with the Montreal price up $4-$5 per cwt. at $142-$144 and the Calgary market up $5-$7 at $137-$140 on steers.
The week’s U.S. cutouts gained substantial ground, rising $12 US per cwt. on the Choice and Select grades. This accounted for a 10 percent increase in price, which also supported stronger U.S. cash cattle prices.
Feeders move slowly
Feeder auction market volume in Alberta was slow again. About 7,200 head traded, well down from last year’s 50,658 head in the same week.
More auction markets held sales but they were smaller than normal, resulting in each weight group being lightly tested.
The week’s volume included slightly more than 1,400 head that traded Jan. 9 on the TEAM sale.
D1, 2 cows were steady to $2 per cwt. higher on light trade.
Canfax said volumes are expected to increase this week but it will take a while before they are comparable to a year ago. Producers remain reluctant to sell, waiting for signs of a trend or leveling out.
When volumes do increase, prices may be pressured lower because feedlots don’t know where to base breakevens for calves finishing this summer and fall, said Canfax.
D1, 2 cows are expected to hold steady.
In stock trade, bred cows were $725-$975 in central Alberta in a light test.
The Alberta-Saskatchewan cattle-on-feed report showed placements in December down 12 percent from last year at 116,633.
Comparing placements to December 2002, there has been a 40 percent decrease in the 800 lb. and heavier category and an 11 percent increase in cattle under 600 lb. Cattle weighing 600-699 lb. increased 11 percent and 700-799 lb. increased two percent.
Marketings were down eight percent in December from last year, but domestic fed slaughter was up 14 percent from last year.
Comparing annual data for 2003 to 2002, domestic fed slaughter decreased 10 percent.
Total cattle on feed for Jan. 1, 2004, decreased 27 percent from Jan. 1, 2003.
A record-large number of cattle were placed in American feedlots in December, said the U.S. Department of Agriculture.
Placements were 110 percent of last year, or 1.748 million head. Trade estimates averaged 105 percent.
Feedlot supply on Jan. 1 was 106 percent of a year ago, or 11.248 million head. That was close to trade estimates.
The report was expected to have a 25-50 cents per lb. depressing effect on deferred futures contracts that reflect the spring and summer markets.
Nearby contracts were expected to be buoyed by strong cash markets last week and hope that American beef exports will resume soon.
Pork prices rise
The U.S. pork cut-out value rose last week, buoyed by higher prices for loins.
One reason for the surge in wholesale loin prices might be Japanese demand as they switch from beef to pork because of the BSE ban.
Packers appeared to need more hogs so they increased hog prices as the week progressed.
The Iowa-Minnesota daily direct hog price (plant mean, 51-52 percent, lean carcass converted to live weight) rose from $38.50 US per cwt. on Jan. 12, to $39.60 on Jan. 15.
However, on average, American hog prices were down by two percent from the week before. Lean hog futures prices declined slightly over the week.
In Canada, the value of the loonie declined, offsetting the lower average U.S. hog price.
Lambs up, sheep, goats steady
At Ontario Stockyards Inc., a total of 2,048 sheep and lambs and 165 goats traded.
Light lambs sold $5 cwt. higher, while all other types of lambs, sheep and goats sold steady. New crop lambs sold at a premium due to weather problems causing a lighter run.
Lambs 65 to 80 lb. were $121-$160 per cwt. with a high to $195, 80 to 95 lb. were $107-$126 per cwt. with a high to $134.
Lambs over 95 lb. were $65-$105 per cwt. with a high to $137. Feeder lambs were $110-$135 per cwt.
Sheep were $47-$57 per cwt. with a high to $64. Plainer types, all weights, were $34-$45. Rams were $55-$70 per cwt.
