Feeder cattle weighing under 700 pounds sold $2-$4 per hundredweight (cwt) higher last week in Western Canada while heavier replacements were steady to $2/cwt above week-ago levels. Quality feeder cattle supplies are starting to wane this time of year and feedlot managers were aggressively bidding on performance-based replacements.
Buying interest on grassers was well noted in the lighter-weight categories while backgrounding operations further enhanced demand for cattle weighing 550 to 650 lbs. Order buyers had more freedom this week driving the market higher, because supplies will be limited later in spring.
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To reiterate earlier comments, buyers have been waiting for prices to pull back and the market is now experiencing pent-up demand. The psychological sentiment of missing quality cattle by two or three cents causes extreme frustration, only to be followed by conflicted feelings of remorse and relief when it takes an additional five to six cents to secure the cattle you want. This is the mindset that keeps an upward trend moving.
Feature sales included quality Charolais-cross medium-flesh steers weighing just over 600 lbs. which sold for $208/cwt landed in southern Alberta. Black Angus-based cattle in the range of 700 to 750 lbs. edged up to $192/cwt in the Calgary area. Buyers looking for stockers under 550 lbs. were paying upward of $240-$250/cwt, which appears to be the new normal price range on the lighter weights.
Alberta packers were buying fed cattle in the range of $136-$138/cwt as wholesale beef prices jumped to historical highs. U.S. choice beef product traded at $240/cwt, up nearly $10 from seven days earlier. The meat complex has solid support as pork and beef retail products are near record highs and this may temper the seasonal weakness in the cattle market during the summer months. The last half of March is a period of seasonal strong demand for beef and fed cattle prices. Feeder cattle prices have divorced from the fed market over the past couple weeks and this behaviour does not usually continue for a long period of time.
— Jerry Klassen is a commodity market analyst in Winnipeg and maintains an interest in the family feedlot in southern Alberta. He writes an in-depth biweekly commentary, Canadian Feedlot and Cattle Market Analysis, for feedlot operators in Canada. He can be reached by email at [email protected] for questions or comments.
