Western Canadian feeder cattle prices were quite variable. Compared to three weeks ago, Alberta prices were steady to $2/cwt higher while in Saskatchewan, prices were $8-$10/cwt higher on average with lighter-weight cattle jumping as much as $15. For example, in central Alberta, higher-quality 800-lb. steers were trading from $230 to $235 and 600-pounders were valued from $260 to $265. Central Alberta prices for 500-lb. steers were averaging $298/cwt.
In northeastern Saskatchewan, higher-quality steers weighing just over 900 lbs. were charting course just over $240/cwt while 800-lb. steers were touching $260/cwt. Steers averaging 600 lbs. were trading above $300 and 500-pounders were ratcheting over $320/cwt. Presort sales were reflecting a sharp premium.
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The market was hard to define and price discovery will become more concrete over the next few weeks. The quality of cattle at each sale also contributed to the volatile market dynamics. Weather has become more conducive in southern Alberta but major feedlot operators were still in holiday mode. Certain buyers looked at values with opportunity. Smaller feedlots that can condition replacements over 90 days picked up stragglers in Alberta. Early backgrounded fall calves will be available over the next month and larger operators are keeping their hands in their pockets for the time being. Alberta packers were showing fed cattle bids for farm in southern Alberta in the range of $183-$185 while U.S. packers were biding up to $190 in the Lethbridge area. Carcass weights are coming down and pickup times are shortening.
Detailed data was hard to come by last week. East of Saskatoon, buyers quoted medium- to lower-flesh Charolais steers weighing just over 900 lbs. trading around $242-$245. Higher-quality larger-frame steers weighing 800-830 lbs. were trading from $255 to $260. In central Alberta, a small group of backgrounded red mixed steers averaging 820 lbs. were quoted at $229.
In southern Alberta, a small group of mixed steers weighing 660 lbs. were valued at $271; in central Alberta, a handful of 660-lb. mixed steers sold for $246. In eastern Saskatchewan, steers weighing in the range of 600-700 lbs. were averaging $296.
There will be a flurry of activity next week. When the market becomes hot, even the stragglers become precious. Canadian and U.S. feeder cattle supplies outside finishing feedlots as of Jan. 1, 2023 are expected to be down sharply from year-ago levels. We want to draw attention to the April 2024 live cattle futures, which reached up to $169.10 on Jan. 4. This is very close to the all-time record high of $172, which was reached during October 2014.
— Jerry Klassen 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.
