Fed cattle prices see a boost

The Markets with Deb McMillin, from the May 2021 issue of Canadian Cattlemen

 

By Debbie McMillin, Contributor, Canadian Cattlemen

April 30, 2021

 

Fed cattle

 

Tighter front-end supplies and higher cut-out values on both sides of the border have boosted fed cattle prices. Although not climbing as rapidly as the cut-out value, the Canadian fed cattle price saw a $2/cwt increase between late March and April 9. The second week of April saw a fed steer average of $150.82/cwt on light trade. The April 9 average is just over $2/cwt higher than the same week in 2020; however, April of 2020 experienced packing plant disruptions throughout North America. When compared to the pre-2020 five-year average for mid-April, the 2021 price is $20/cwt lower.

 

After a slow seasonal decline, the average steer carcass weight jumped again in early April to a weekly average at 948 lbs., 46 lbs. higher than the same time last year. The additional pounds coupled with larger slaughter rates have fed beef production up nine per cent through the first quarter of the year when compared with the first quarter of 2020. In Canada, a total of 398,737 head of fed steers had been slaughtered in the first thirteen weeks of 2021, an increase of one per cent. The rise in heifer slaughter was even larger, up 17 per cent to 268,307 head. Exports of live fed cattle, including fed cows, are down 10 per cent to 119,554 head.

 

Debís outlook for fed cattle: Continued uncertainty around COVID-19 cases, restrictions and vaccination rollout plagues the cattle market. Fundamentally, the market is in good shape to set spring highs over the next few weeks as supplies are tightening, set-aside cattle have been cleaned up, beef demand continues to be strong and grilling season is ahead of us. However, the third wave of COVID-19 has been officially announced and at the time of writing restrictions in many provinces are once again being added, with foodservice and employment changes having an impact on consumer spending. In contrast to Canada, many U.S. states have dropped restrictions and are operating in a more normal fashion. This should help support Canadian prices as well as potentially increase export demand. As we move through the second quarter hopefully COVID-19ís effects will be limited and beef will continue to see a seasonal rally. Expect higher prices in the near term, however, as any disruptions in the supply chain or additional restrictions may be limiting factors.

 

Feeder cattle ...

 

Debís outlook for feeder cattle ...

 

Non-fed cattle ...

 

Debís outlook for non-fed cattle ...

 

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