Exports of live feeder cattle to the United States since the border opened last summer are nearly double the average of pre-BSE days.
Cattle younger than 30 months old destined for U.S. feedlots or slaughterhouses are moving at a steady rate, said Canfax analyst Anne Dunford, at the Alberta Beef Producers annual meeting Dec. 5 in Calgary.
Average feeder exports are at 15,000 a week compared to 4,500 a week from 1998-02.
Fed steers and heifers are averaging 9,700 per week, consistent with the five-year average.
The boost in Canadian exports comes at a time when the U.S. herd is in expansion mode. More heifers are being retained on the farm rather than going on feed, one of the early indicators of growth.
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“This is the first year we have seen an increase in numbers in their beef cow inventory,” Dunford said.
In addition, Canadian slaughter numbers are higher than average.
At the end of 2003, weekly capacity was about 73,000. By the fall of 2004 it was up to 79,575.
In the spring of 2005, about 88,775 were killed per week and to date about 93,200 head per week were processed.
Weekly inspected slaughter in Canada should hit 4.2 million by the end of 2005.
“When the dust settles out for 2005, it looks like we are going to get total slaughter up three percent larger than last year,” Dunford said.
As packers expand capacity, there is a difference between utilization rates and what could be potentially processed.
Packers have the space to do more but are averaging around 88 percent utilization from last fall to the summer.
When workers at Lakeside Packers at Brooks, Alta., went on strike this fall, the plant worked at 70 percent capacity. Some cattle have been removed due to the border opening and fat animals being exported.
Increased slaughter has also occurred in the weekly cow kill, where recently 15,000 were handled. This is the largest amount processed since 1996.
Pre-BSE, total cow sales averaged about 800,000 per year.
The cow kill is up 29 percent in 2005, resulting in 625,000 cows being removed from the system. These cattle and the beef from cattle older than 30 months cannot be exported at this time so the meat remains in Canada.
Cow prices are still well below the U.S. benchmark, said Dunford. U.S. utility cow prices show a wide disconnect between Canada and the United States. The U.S. price is 55-57 cents per pound Cdn compared to about 30 cents in Canada.
Youthful cattle have fared better. The 850 pound steer price in Western Canada since April gained $300 per head on this weight range.
Fed steer prices are the highest they have been since May 2003.
However, last week the U.S. market jumped, but the stronger Canadian dollar was higher, resulting in Canada being dropped $14 below the U.S. price.
