Compared to the previous week, western Canadian feeder cattle markets traded steady to $3 lower over the past week. In some cases, calves were down $4 to as much as $6. Rising feed grain costs weighed on the overall feeder complex. Feed barley in southern Alberta traded in the range of $265-$275 per tonne delivered, which was $5-$10 per tonne higher compared to seven days earlier. A large portion of Saskatchewan has received less than 40 per cent of normal precipitation. It doesn’t appear that hay prices will come down significantly in the near future.
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The quality of cattle coming on stream was quite variable last week. Feedlot staff reported very scrawny calves coming through the chutes for processing this week. It appears ranchers are liquidating the “stragglers” or “late bloomers.” There are still a fair number of backgrounded cattle coming onto the market but many of these higher-quality groups are moving directly off farm to finishing operations. Harder-flesh yearlings are moving through the ring and the trained “buyer’s eye” was quick to back away. Many auction markets experienced lower numbers last week; there was only a handful of buyers at some smaller sales. This environment also contributed to the weaker price structure because there was very little competition.
In central Alberta, larger-frame Simmental based 980-lb. steers with heavier flesh levels were quoted at $169; similar quality heifers averaging 920 lbs. were valued at $156. In southern Alberta, mixed red and tan steers weighing 840 lbs. were quoted at $185 landed in the feedlot. Red white faced heifers weighing 835 lbs. were quoted at $158 in the Lethbridge area.
East of Saskatoon, thinner mixed steers weighing 670 lbs. were quoted at $217 while medium-frame red mixed heifers weighing 715 lbs. were valued at $168. In southwestern Saskatchewan, thinner Charolais mixed 530-lb. steers were quoted at $238 and similar-quality heifers averaging 515 lbs. were valued at $203. Near Lethbridge, an even group of medium- to larger-frame black heifers with medium butter levels averaging 685 lbs. was quoted at $185.
— 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.
