Western Canadian feeder cattle prices were quite volatile over the past week, trading steady to $8 higher in some cases. Noticeable gains were seen on cattle under 700 pounds, which traded $3 to $8 higher compared to week-ago levels. Cattle over 700 lbs. were $3 to $4 higher in Saskatchewan and Manitoba, while shorter-keep replacements were unchanged to $2 higher in Alberta.
Certain auction markets were closed due to Easter, and quality feeder cattle will be hard to come by later in May. The anticipated tight supplies, along with stronger fed cattle values, were the main factors enhancing upward momentum. Alberta fed cattle prices reached above the magical $200 level, with certain strings topping out at $200.25. Feedlot margins are now nearing $200 per head and this unprecedented period of profitable margins feeding cattle has concretely reinforced prices for feeders. Wholesale beef prices also climbed higher this week, with choice product trading at US$257 per hundredweight (cwt).
Steers weighing just over 600 lbs. were trading in the range of $320-$330 across the Prairies. Grassers were extremely “hot,” on strong buying interest from feedlots and the farmer/cattle producer. Larger-frame fleshier mixed steers averaging 800 lbs. were quoted at $275 in eastern Saskatchewan. The Alberta market was slightly softer than Saskatchewan and Manitoba, likely due to limited buying interest from south of the border.
Early in the week, we saw 900-lb. steers contracted for late August delivery at $250, up $10 from late March. Feeder cattle futures have come under pressure, but prices remain attractive in the deferred positions.
Year-to-date feeder cattle exports to the U.S. for the week ending March 28 were 143,000 head, up 13 per cent from 127,000 head last year. In past years, U.S. buyers were strictly shopping for 750-lb.-plus feeders for direct export movement; however, this year we find customers south of the border shopping more aggressively for cattle in all weight categories.
Lethbridge barley was trading at $215 per tonne delivered this past week, up $7 per tonne from seven days earlier. New-crop prices are hovering from $180 to $185 delivered Lethbridge. Favourable weather generally sets a bearish tone for new-crop prices at this time of year.
— 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.