Klassen: Beef demand sustains feeder prices

Feeder cattle prices in Western Canada were $1-$4 per hundredweight (cwt) lower on average for the week ending April 8. Feeder steers weighing 625 pounds sold for $155/cwt in southern Alberta while good quality 720-lb. cattle brought back $135/cwt. The Alberta slaughter market was $2 to $3 lower finishing at $113/cwt.

Good framed healthy bred cows topped out at $1,600, with larger ranch buyers showing strong demand underneath the market. At this time, forage supplies look plentiful in Western Canada, which has encouraged herd rebuilding. The U.S. is a different story, with the cow slaughter running marginally higher than last year. The drought in the U.S. Southern Plains may delay herd expansion.

Beef demand continues to drive the overall cattle complex. U.S. unemployment numbers continue to improve as the private sector added 230,000 jobs in March, following 240,000 jobs in February. North Americans’ at-home and away-from-home spending on food has been running 10 per cent above year-ago levels due to the increase in consumer income. Retail sales are percolating higher and consumer confidence remains in an upward trend. Offshore beef exports are up sharply over year-ago levels with steady demand from South Asia.

A slow snow melt has slowed movement of grass cattle onto pastures in Western Canada. There is potential for a surge in demand for lightweight grassers later in April and May. Talk in the industry suggests buyers have been holding back on purchases until pastures are well established.

— 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] or at 204-287-8268 for questions or comments.

About the author



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.


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