Western Canadian feeder cattle prices found some footing this past week trading at similar levels to seven days earlier. Auction market volumes consisted of stragglers and late bloomers with minimal numbers on offer; buyers on hand continue to promote the scarcity principle which caused the market to stabilize. Feedlots operators were quite aggressive on 800 pound plus cattle causing feature strings to trade marginally higher. Feedlot hands are still busy with silage but there is plenty of pen space available. We’ve seen the US feedlot placements come in below year-ago levels over the past few months which may cause beef production to be lower than expected in the early winter period. Therefore, feedlots are gearing up for this marketing time frame.
The crowd for lighter weight feeders was more cautious and the market was quite variable across the prairies. In the drought areas of Alberta and Saskatchewan, the market felt somewhat sluggish but in Eastern Saskatchewan and Manitoba, where forage supplies are more abundant, the market was firm. Waiting on purchases has been costly in past years so certain backgrounding operators want a head start on building inventory. It appears Western Canada will have a long open fall without frost. Pasture conditions are favourable to carry cattle for the next couple months and this also spurred on buying interest for grassers.
A small string of black Angus cross steers weighing just under 800 pounds sold for $264 in central Alberta; mixed heifers averaging 865 pounds dropped the gavel at $239 in the same region. In East central Saskatchewan, mixed steers with no special feature weighing just over 700 pounds reached up to $299. Steer calves weighing from 475 to 525 averaging traded in the range of $320 to $340 in Southwest Manitoba and Eastern Saskatchewan.
Alberta packers came out of hibernation this week buying fed cattle at $183 and breakeven pen closeouts are closer to $190. Consumers are choosing lower cost pork and poultry over beef products and despite the summer grilling season, it’s a distant memory since we saw retailers feature beef products. U.S. choice wholesale beef values finished the week at $232/cwt, similar to seven days earlier but down from $262 for the same time last year.
– Jerry Klassen is manager of the Canadian office for Swiss based grain trader GAP SA Grains and Produits Ltd. He is also President and founder of Resilient Capital which specializes in Proprietary Commodity Futures Trading and Commodity Market Analysis. Jerry owns farmland in Manitoba and Saskatchewan but he grew up on a mixed farm feedlot operation in Southern Alberta, which keeps him close to the grassroots level of grain and cattle production. Jerry is a graduate of the University of Alberta. He can be reached at 204-504-8339.