Compared to last week, western Canadian feeder cattle over 800 lbs. traded $8-$10 higher while lighter weight categories were up $4 to as much as $12 in some cases. Feeder cattle under 800 lbs. were very well bid across the Prairies; feeder cattle under 700 lbs. are now trading at prices similar to late February, prior to the COVID pandemic.
The improving slaughter pace on both sides of the border, along with the bounce in nearby fed cattle prices, renewed buying enthusiasm for all weight categories. Order buyers were extremely busy. While many feedlot operators focused on local cattle, Alberta buying interest extended into all regions of Western Canada. Many cow-calf producers and backgrounding operators have held onto cattle one or two months longer than expected so there was pent-up selling interest. Good volumes of weaned and unweaned calves were available. Generally speaking, yearlings were somewhat fleshier than normal. In most cases, backgrounders have done a decent job limiting the weight gain.
In central Alberta, mixed medium- to larger-frame steers weighing 875 lbs. that were on a 20 per cent grain ration sold for $172 and red mixed heifers averaging 824 lbs. were valued at $161.
In central Saskatchewan, a group of 69 Charolais-blended steers on minimal grain ration weighing 718 lbs. dropped the gavel at $188 while black steers weighing just over 750 lbs. sold for $195. In Manitoba, exotic steers weighing 875 lbs. were quoted at $168 while black heifers weighing 845 lbs. were reported at $144. In the Lethbridge area, a group 66 red steers averaging 809 lbs. sold for $183. And tan heifers weighing just under 700 lbs. were valued at $177.
Lighter calves were surprisingly strong but the market was quite variable. In central Alberta, steers weighing 500-525 lbs. were quoted in the range of $235 to as high as $255 while similar weight heifers were quoted from $190 to $210. In Manitoba, Charolais-based steers weighing 655 lbs. were valued at $211 and similar quality 665-lb. heifers were quoted at $187.
We’ve seen an improvement in the weekly slaughter pace in Canada and the U.S. However, it will take an extended period of time to work through the backlog of market-ready supplies. The Statistics Canada acreage report and USDA’s WASDE report were considered bearish for new-crop feed grain prices. The weaker barley outlook for new-crop is likely contributing to the recent strength in calf prices.
— Jerry Klassen manages the Canadian office of Swiss-based grain trader GAP SA Grains and Produits Ltd. and is president and founder of Resilient Capital, specializing in proprietary commodity futures trading and market analysis. Jerry consults with feedlots on risk management and writes a weekly cattle market commentary. He can be reached at 204-504-8339 or via his website at ResilCapital.com.