Threat rocks market
When strike notice was served at Tyson’s Lakeside plant at Brook, Alta., Oct. 5 the plant stopped bidding on cattle, staggering the market, said Canfax.
Other Alberta packers were quick to respond and dropped bids by about $2-$3 per hundredweight from earlier in the day.
Feedlots were reluctant to sell at the lower prices, especially given the strong tone out of the United States, and trade quickly slowed.
Canadian cattle that traded into the U.S. saw prices steady with the week before. This activity remained brisk.
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The weekly volume was about 20,000 head, down six percent from the week before.
In light trade, prices in Alberta
Oct. 6 were steers $82.20-$84.85 cwt., flat rail $137.60-$140.25 and heifers at $84.85.
The market this week will be dominated by whether the Lakeside strike goes ahead on Oct. 12.
The U.S. market continues to see packers losing money, caught between a tighter than expected supply of market ready cattle and an inability to push beef prices high enough.
Beef edges higher
Canadian cutouts edged a bit higher late in September but are still sitting down about two percent for AAA and five percent for AA from last year, said Canfax.
Movement has been moderate, domestically and into the U.S.
If Lakeside is closed by a strike, other Canadian packers will move their price lists higher given a more captive buying audience.
The U.S. cutout last week saw a solid gain with Choice up $5.50 US per cwt. and Select up $6 from the week before.
The Choice cutout is now 10 percent higher than 2004.
The Calgary wholesale price for delivery this week eased a bit to $143-$146 per cwt.
Calf run increases
Calf volumes and buyer interest, including American bidders, increased at Alberta auction markets, said Canfax.
About 66,500 head traded, 23 percent more than the week before and 26 percent higher than the same week a year ago.
Steer calves were steady to $1.75 higher with 500-600 pound calves gaining the most. Heifer calves were also steady to $1.50 higher.
With yearling numbers slowing, 800-900 lb. steers were $1 lower, but 900 lb. and heavier steers were $1.50 higher. Yearling heifers were steady to $2.50 higher.
D1, 2 cows slipped 50 cents with Lakeside off the market. Butcher bulls were steady to slightly lower.
Feeder cattle exports last week at just a little more than 15,000 head indicates strong U.S. interest that is expected to continue.
The current U.S. 550 lb. price of around $125-$128 US works out to $147-$150 Cdn before costs, said Canfax. Volumes will continue to increase as more producers wean calves, while yearling numbers trickle in.
Cull cows and bulls will struggle if Lakeside stays off the market.
Stock bred cows traded in central Alberta at $500-$1,000 with tops to $1,400. Bred heifers in northern Alberta brought $500-$975.
Cow-calf pairs were $500-$900 with tops to $1,040.
Hog prices steady
U.S. hog plants continued to kill at a fairly strong pace, helping to keep hog prices steady.
Chicago lean hogs futures contracts mostly rose, carried by the strong cash market and increasing fund interest.
The Iowa-southern Minnesota cash price Oct. 7 was $50 US per cwt. compared to $49.50 Sept 30.
The United States Department of Agriculture composite pork carcass cutout value was $70.25 on Oct. 6 compared to $70.40 on Sept. 30.
Ron Plain and Glenn Grimes of the University of Missouri said in their Oct. 7 report that if marketings during the next 15 months are consistent with USDA inventories and farrowing intentions, 2006 hog slaughter is expected to be about one percent larger than 2005.
With that slaughter estimate and a demand picture that retains most of the growth seen in 2003-2004, prices for 51-52 percent lean live hogs should average between $44-$46 per cwt. in 2006. In 2005 it was $49-$50.
Light lambs stronger
Ontario Stockyards reported 2,253 sheep and lambs and 258 goats traded. Light lambs sold at prices $5-$8 cwt. higher. Heavy lambs, sheep and goats traded steady.
