The Western Producer (Canada)
Published: September 12, 2019
This cattle market information is selected from the weekly report from Canfax, a division of the Canadian Cattlemen’s Association. More market information, analysis and statistics are available by becoming a Canfax subscriber by calling 403-275-5110 or at www.canfax.ca.
Fed prices continue slide
Alberta direct cattle sales saw moderate volume trade last week and average prices continued to soften to new annual lows. Fed prices have steadily declined over the past five weeks.
Average steer prices last week eased $1.60 per hundredweight lower to $140.07 and were almost $2.50 per cwt. lower than the same week last year. Average steer prices last week were the lowest since October 2017. Heifer prices have softened over the past seven weeks, and average prices dipped $1.68 per cwt. lower to $139.31.
Competition was lacking last week on seasonally lacklustre post-Labour Day beef demand, and front-end packer inventory is building.
The cash-to-futures basis strengthened significantly to +9.32 per cwt. Western Canadian fed cattle slaughter for the week ending Aug. 31 was 10 percent lower than the previous week at 45,619 head and year to date was six percent larger, totalling 1,377,996 head.
Western Canadian steer carcass weights eased nine pounds smaller than the previous week to 906 lb. and were eight lb. larger than a year ago. Canadian fed cattle/slaughter cow exports to the United States for the week ending Aug. 24 were nine percent larger than the previous week at 6,900 head. Year to date exports were 25 percent larger, totalling 296,803 head.
Ample market-ready supplies are anticipated through September, and additional price downside is anticipated. Seasonally softer boxed beef values could encourage reduced fed kills, and feedlots are expected to trend less current. Packer inventories continue to build, and cash market competition will be limited.
In the U.S., fed prices trended lower last week. Lower U.S. cash prices and concerns about maintaining fed slaughter following the Tyson Kansas plant fire contributed to eroding cattle futures.
Live trade in the south was generally US$3 per cwt. lower than the previous week at $100 per cwt. Live trade in the north was reported from $101-$103 per cwt, which was $3-$5 lower than the previous week.
Cows a bright spot
Butcher cow prices continue to be the bright spot for the non-fed market and are holding up much better than the fed cattle market. Alberta D2 cow prices have been hovering on either side of C$90 per cwt. for the past three weeks and are trading within $2.50 per cwt. of their second half highs. Last week they traded at $83-$97 per cwt. to average $89.42. D3 cows traded from $75-$85 to average $80.
On a dressed basis, rail cow prices are only $60 per cwt. back of the fed cattle prices. Western Canadian cow slaughter for the week ending Aug. 31 totalled 6,199 head, six percent lower than last year. In five out of the past six weeks western Canadian cow slaughter has been below year-ago levels. On a cash to cash basis, D2 cows are trading at a $4.50 per cwt. premium against the U.S. utility cow market compared to $12.25 per cwt. last year.
Over the past four weeks butcher bull prices have dropped $7.25 per cwt. Last week they averaged $104.64 per cwt. Bull prices are $8 per cwt. lower than last year, while cow prices are $1-$2 higher year over year. Cow-calf pairs that were purchased this spring and put on feed over the summer have started to hit the market.
Stronger basis for feeders ...
Beef trade ...