Canfax Weekly Article | Report for the week of April 10, 2023

Alberta-fed steers climbed over $3/cwt last week to $217.59/cwt live FOB the lot. Alberta steer prices have rallied $9.70/cwt in the last four weeks, while steer carcass weights have dropped 23 lb in the west. Steer weights are now 53 lb below year-ago levels and 15 lb lighter than the five-year average. There was insufficient heifer trade to establish a repeatable market trend. YTD Western-fed cattle slaughter is down 2% from last year, with steers up 10% and heifers down 16%. Total Western slaughter is steady year-to-date. The Alberta cash-to-futures has strengthened but remains well back of the five-year average. The Alberta/Nebraska cash basis has weakened over the last two weeks to be back at -$17.57/cwt.

Feeder prices traded generally steady last week, with strong demand observed for large calves over 600 lb. Light calves less than 600 lb traded $4-8/cwt lower on reduced quality and lot size. Continued strong prices flushed out a mixed offering of varied quality that may have muted the feeder price tone last week. Larger calves from 600-700 lb saw strong demand, particularly as grass types, to finish against the fourth quarter-fed market. Total auction volumes were 33% smaller than the previous week at 24,449 head. YTD auction volumes have consolidated with last year to be steady at 388,492 head. Canadian feeder exports to the U.S. for the week ending March 25 were down at 2,690 head and YTD were down 62% to 28,263 head.

Non-fed cattle in Alberta traded mixed last week. Alberta D2 cows eased lower, down another $3/cwt to close just shy of $130/cwt. Alberta bulls closed $1/cwt higher to $148/cwt. Ontario D2 cows were off $2/cwt to $120/cwt. Cows in both Western and Eastern Canada have softened over the last two weeks. YTD Canadian cow slaughter totaled 140,269 head, with weekly slaughter below 9,000 head for the first time this year.

Bull:

• Cattle futures rallied higher this week, and North American cash markets strengthened.
• Fed calves are seasonally expected to come market ready later than usual, and feedlots would like to add as many days on feed as possible.
• For the first time this year, weekly Western cow slaughter has fallen below year-ago levels.

Bear:

• The cash-fed basis continues seasonally weak.
• Wholesale buyers are sitting on the fence waiting for cheaper beef.
• Competition on a dwindling supply of feeders will intensify moving forward.