Beef market uncertain
Analysts are not sure how America’s actions to fight terrorism will affect beef markets.
Some believe that the struggle, coupled with a recession, will reduce the consumer’s disposable income leading to less meat consumption, said Canfax.
Others believe that war generally strengthens the economy and the armed forces will require meals with beef.
While beef consumption related to travel and high end restaurants is down, the reduced travelling could increase the money people have to buy beef at home and at local restaurants.
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Last week, cash and futures markets were down, following the stock markets and other commodities.
Western Canadian cash prices were down $2-$2.50 per hundredweight on average, said Canfax.
But feedlots with large front-end supplies of fed cattle had no ability to balk at the lower prices. Volumes traded were large and only a few cattle were passed. American packers continued active buyers.
Alberta prices Sept. 20 saw steers at $89.20-$94.85 per cwt., flat rail $154.45-$155.40 and heifers flat rail $154.
In the wholesale beef market, restaurant demand is down, but retail buying for home consumption is up.
The Montreal price is steady at $165-$167 per cwt. and the Calgary market is steady to $1 lower with handyweights at $160-$169 and heavies at $156.
Canfax said it is impossible to predict the market’s trend other than continued volatility.
Sellers will need to clean up the number of market-ready cattle before a recovery can proceed. Carcass weights are six pounds heavier than this time last year.
Feeder prices holding
Feeder cattle prices were steady to $1.75 higher on all calves and yearlings steers, in Alberta.
Yearling heifers were under some pressure with averages down $1.50-$3.
The problems in the fed market did not hurt the feeder market last week, nor did falling feeder futures on the Chicago market.
But Canfax said these factors could pressure feeder prices lower in the coming weeks. On the other hand, barley futures have also decreased, which may help support prices.
In stock cow trade, cow-calf pairs in light trade were $1,100- $1,480.
Bred cow volumes were small and traded at $900-$1,230, with some sales as low as $750 on lower quality. Bred heifers traded from $800-$1,250.
The Sept 1, 2001 USDA cattle-on-feed report had some interesting numbers, but will probably be lost in the broader market concerns
The positive news for markets was that placements were down nine percent from the same time last year, two percentage points lower than analysts’ expectations.
However, there were still record large numbers of cattle on feed, up five percent over last year.
The marketing number was neutral at two percent down from last year.
U.S. pork prices slip
There was stronger seasonal demand for hams in the U.S. last week, but lower wholesale prices on other pork cuts hurt hog prices, said Manitoba Agriculture.
The Iowa-Minnesota daily direct hog price (mean, 51-52 percent lean, live equivalent) rose initially, but declined to $47.20 US cwt. on Sept. 20. The week’s average hog price was down about 0.7 percent.
Canadian prices rose.
Maple Leaf Pork advised Manitoba hog producers starting on Nov. 5, all non-contract hog purchases will be settled the same way regardless of whether they are processed in Brandon or Winnipeg.
Quebec’s largest pork processor, Olymel, is negotiating a new labour contract at its two biggest slaughter plants in Quebec. Olymel’s workers are now operating on a work-to-rule basis, which means no Saturday kills.
Surplus hogs are already being shipped into Ontario and Manitoba from Quebec, but a strike could result in a significant number of Quebec hogs moving west.
