Fed market softens
The Alberta fed cattle market tone was softer last week with lacklustre trade interest before the July 1 holiday. Most trade was steady, with the lower end of last week at $292 per hundredweight delivered. The weighted average steer price eased around $1 per cwt. lower than the previous week to $173.18 per cwt. Thin heifer trade was reported, but volumes were too slight to establish a trend.
Western Canadian fed slaughter for the week ending June 25 surged 19 percent larger than the previous week to 50,886 head, the largest since May 2005. Year to date, western fed slaughter was four percent larger, totalling 1,078,334 head. Steer carcass weights eased lower across Canada and nationally were seven pounds lower than the previous week at 873 lb.
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A handful of Ontario cattle traded steady with the previous week at $320 per cwt. delivered, but most sales were reported $2 per cwt. lower than the previous week at $318.
Eastern Canadian steer carcass weights for the week ending June 25 dipped six lb. lower than the previous week to 911 lb.
Inflation has tightened consumer purse strings and overhead wholesale price resistance was observed in all North America fed markets last week.
In the U.S., light to moderate trade was reported up to June 30 with southern live trade continuing steady to US$1 per cwt. lower than the previous week at $137-$138 per cwt. Northern live trade was steady to $1 higher than the previous week with most priced from $145-$148 per cwt.
Cow prices healthy
Even with recent rains across much of the Prairies, non-fed volumes did not slow as much as expected. Cow prices at the highest level since 2017 could be one reason.
Over the past month, D2 cow prices have averaged on either side of $105 per cwt. On a cash- to-cash basis, Alberta cow prices have been trading at a $9 per cwt. discount against the U.S. utility cow market, whereas last year’s prices were at a $14-$15 per cwt. premium. D2 cows averaged $105.19, and D3s averaged $92.83 last week.
Trading $1.65 per cwt. higher last week, butcher bulls established new annual highs at $130.65 per cwt. Butcher bull prices have been the shining star in the non-fed market. U.S. demand for butcher bulls continues to be strong. For June, they are on track to average in the $128 per cwt. area, the second highest price on record.
For D2 cows, this will be the fourth highest price on record for the month of June. In 18 out of the past 30 years, D2 cow prices have strengthened from June to July. Ontario D2 cow prices have strengthened for six straight weeks, averaging more than $120 per cwt.
Feeder market slow
On a light test of the market, calf and feeder prices traded mixed last week. Heavier weight heifer prices have struggled to keep pace with steers. Steers weighing more than 800 lb. set a new annual high last week, while heifer prices are $2 shy.
For the month of June, the 850 lb. steer/heifer price spread was $24 per cwt., the largest price spread on record. It should not come as a surprise. Based off the five-year average, June is traditionally when we see the widest steer/heifer price spread.
Recent rains brought renewed buying interest from many grass operators. With lighter volumes of calves and feeders on offer, grass buyers showed interest in all classes of cattle from light calves to heavier weight feeders and even heiferettes.
Canadian feeder cattle exports to the United States for the week ending June 18 totalled 4,002 head, 133 percent larger than last year and 94 percent larger than the five-year average.
Most of the cow-calf pairs on offer last week were middle-aged cows with younger calves at side. Cow-calf pairs traded from $1,675-$2,175 each, averaging $1,825 per pair. Some producers hauled their late calving cows to market. Bred cows were reported from $1,400-$1,625 per head, averaging $1,550.
Cut-out spread widens
In U.S. beef trade, Choice averaged US$264 per cwt. as of June 30 and Select averaged $240.57, both on a lowering trend. The Choice/Select cut-out spread rebounded to $23.43 per cwt. and is now $6.72 per cwt. above the five-year average.
