Fed cattle weaken
Now that Canadian and American fed markets are linked again, prices north of the border will be affected by American market fluctuations.
That’s what happened last week. U.S. fed prices fell as the market continued to struggle with weak consumer demand, with buyers put off by high beef prices at the supermarket. Also the recent heat wave that affected large parts of the U.S. kept people away from their barbecues.
Canfax said Canadian fed steer and heifer averages fell $1.50-$2 per hundredweight last week.
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Canadian packers were not aggressive and some even ran reduced schedules. Prices improved as the week wore on.
Feedlots tested the export market. The Canadian Food Inspection Agency said that to midweek a total of 9,434 fed and feeder cattle had been certified to move south. This should help keep packers from pressuring the market beyond the U.S. price floor, Canfax said.
Packer activity will be down this week because of the holiday.
In light trade July 29, Alberta steers were $83.50-$84.50 per cwt. and heifers $83.45-$83.90.
Canfax expects the American market will remain weak through August.
The news of another possible U.S. BSE case appeared to have little impact on markets and likely won’t even if it is confirmed positive.
Canfax said feedlots will want to stay current as more set aside cattle work through the system.
Cutouts in the U.S. saw another tough week with the Choice losing $3.80 US per cwt. and Select dropping about $5, Canfax said. Cutouts are now 12-14 percent lower than a year ago.
The lower cutouts enticed better beef movement as the load counts rose two percent from the week before.
Canadian cutouts have also been falling but not as fast as the U.S., mostly due to the change in the exchange rate softening the blow.
Cutouts here are still slightly stronger than the U.S., a scenario that typically doesn’t last long, said Canfax. Canadian cutouts were about 50 cents Cdn lower compared to the previous week and are seven to eight percent lower than a year ago. Fed cattle slaughter was smaller last week as some plants got back into the cow killing business now that the USDA final rule is in play.
Calgary wholesale carcass trade for delivery this week saw prices fall $2 per cwt. to $142.
Cows rally
The big news was in the cow market, said Canfax.
D1, 2 cow prices went from mid-$20 last week to mostly $32-$40 with tops to $47.50. Butcher bulls also jumped $5.50.
D1, 2 cow supplies are at their seasonal lows. Also there is more market competition with Lakeside now slaughtering cows. Supplies of cull cows are not anticipated to increase until mid-September.
Steers strong
Volumes through Alberta auction markets backed off by five percent to just under 13,500 head trading, but 59 percent larger than a year ago.
Feeder steers were steady to stronger, but heifers started to feel slight pressure.
Steers 500-600 lb. were $1 higher, while 600-700 lb. steers rose $3. Steers 700-900 lb. traded steady to $1 higher and 900 lb. and heavier were $2.50 higher. Heifers 500-900 lb. were steady, while 900 lb. and heavier were $1 lower.
Although higher feeder prices are attracting interest, cow-calf producers are content to keep yearlings on grass, given excellent pasture conditions, said Canfax.
Runs are expected to start picking up in the next week.
Stock bred heifers and cows in northern Alberta were steady, trading at $300-$650. Cow-calf pairs in the same region brought $475-$1,075 depending on quality.
Hogs rally
Cash hog prices in the U.S. edged higher last week thanks to stronger pork prices, better packer profit margins and lighter carcasses resulting from the recent heat wave.
USDA estimated the week’s hog slaughter at 1.857 million head, down from 1.869 million the previous week and 1.889 million the previous year.
The lighter kill helped prop up pork prices, which bolstered packer margins.
After hitting $51 US earlier in the week, Iowa and southern Minnesota hogs traded at $50.50 delivered to pork plants July 29, up 50 cents from the week before.
Prices weakened late in the week as packers were well supplied going into a week when many plants operated for only four days.
The USDA composite pork carcass cutout was $72.45 July 29, compared to $70.85 the week before.
Sheep steady
Ontario Stockyards reported 2,129 sheep and lambs, and 107 goats traded. All sheep, lambs and goats sold steady.