Livestock battered
Weak demand for meat because of high unemployment levels and worries about the economy is putting downward pressure on livestock prices at a time when the market is usually buoyed by strong demand for grilling season.
Cool weather across much of North America is also discouraging barbecues and international export markets are weak because of the global recession and lingering trade restriction on pork because of H1N1.
On June 4, the U.S. Choice cutout fell to $140.32 US per hundredweight, down $16.54 from the same day last year.
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The hog carcass cutout fell to $56.07 US per cwt. on June 5, down from $76.76 last year at the same time.
The weak U.S. dollar caused most commodity futures prices to rally last week, but the Chicago livestock complex fell because of demand problems.
The strong Canadian dollar is lowering farm gate receipts here.
Fed cattle weaken
The following cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattlemen’s Association.
Far more market information, analysis and statistics are available by becoming a Canfax subscriber by calling 403-275 5-110 or at www.canfax.ca.
The strong Canadian dollar reduced American buying interest.
Canfax said fed steers averaged $85.82 Cdn per hundredweight last week, down $3.70 and heifers were $85.55, down $3.65.
The Alberta-Nebraska cash-to-cash basis strengthened to $4.94 under compared to $5.09 under the previous week. Fed cattle exports to the U.S. for the week ending May 30 totalled 5,930 head, down from 7,041 head the previous week, Canfax said.
Market ready supply is expected to increase in June and, with weak demand from the U.S., prices could weaken.
Slow beef movement means packers will likely operate with hand to mouth inventories, Canfax said.
D1, 2 slaughter cow prices averaged $47.46 per cwt., down $3.71. Butcher bulls averaged $59.22, down $1.45, said Canfax.
Feeder prices lower
Feeder steers on average fell $1.76 per cwt. and heifers were 27 cents lower, Canfax said.
Feeder prices have trended lower for the past five weeks.
Steers 300-400 pounds were $1.47 lower and 400-500 lb. steers fell $2.08. Steers 500-600 lb. dropped $3.09 and 600-700 lb. dropped $2.67per cwt.
Seasonal quality is a factor but demand for all weights of grass cattle is drying up along with pasture conditions.
Prices for 700-900 lb. steers were down $1.45-$1.85 per cwt., while steers heavier than 900 lb. rose 28 cents, Canfax said.
Heifers 300-400 lb. rose $4.18 per cwt., while 400-600 lb. were 56-73 cents lower.
Heifers 600-800 lb. were mostly $1.42-$1.89 lower. Heifers heavier than 900 lb. held mostly steady.
Auction volume the last two weeks rose significantly due to lack of grass, Canfax said. If rain does not come soon, expect even larger volumes at auction markets.
Bred cows were $131.25 per head lower, while bred heifers saw a slight drop of $7.50 per head, Canfax said. Cow-calf pair prices were mostly steady but will fall if pastures deteriorate.
Beef prices lower
U.S. packers became worried about rising unsold beef stocks and accepted much lower prices last week, causing a lot of meat to move.
The Choice cutout declined $5.15 to $140.32 US, while Select dropped $4.40 to $134.92, Canfax said.
Canadian AAA cutouts for the week ending May 29 were down $4.52 Cdn from the previous week, but six percent higher than the same week last year.
AA cutouts dropped $6.72 from the week before, but were two percent higher than last year, Canfax said.
The Calgary wholesale market for delivery this week was $4 lower at $166, while Montreal was down $1 at $178.
Hog prices fall again
The long period of falling hog prices had traders thinking that the pace of sow liquidation in the U.S. would increase.
This would put more pork on the market and cause a period of even lower prices. Chicago lean hog futures fell each day last week.
Iowa-southern Minnesota cash hogs were at $42 US per cwt. June 5, down from $44 May 29.
The U.S. pork carcass cut-out value fell to $56.07 June 5, down from $58.89 May 29.
U.S. federal slaughter to June 6 was estimated at 2.1 million, up from 1.8 million in the previous holiday shortened week.
Compared to the same week last year, slaughter was down 0.4 percent.
Loonie affect bison values
The Canadian Bison Association said the strong Canadian dollar caused heifers on average to fall five cents.
Grade A carcasses from youthful bulls in the desirable weight range in Canada were at $2.40-$2.64 hot hanging weight. Heifers were $2.30-$2.45 per lb.
The cull cow and bull average was $1.25 per lb. on tight supply.
Weight, quality, age and delivery location affected final price.
Lambs, sheep weaker
Ontario Stockyards reported 1,690 sheep and lambs and 65 goats traded June 1. Well-fed lambs and feeder lambs dropped by $5-$10 per cwt.
Sheep were $5 per cwt. lower. Goats were barely steady.
