Canfax Weekly Article | Report for the week of April 17, 2023

The Canfax fed steer and heifer price closed the week at around $222.50/cwt, $5/cwt higher than the previous week. Fed prices have traded higher for 17 consecutive weeks. Last week, dressed sales were reported from $367-373.50/cwt FOB the lot. Most of the cattle that traded were being scheduled for the week of April 17 and 24 delivery. The Alberta fed cash-to-futures basis weakened from -$8.75/cwt to -$10.24/cwt last week. For the middle of April, basis levels are the weakest since 2014.

The Canfax average feeder steer and heifer price was $3.50-4.50/cwt higher. Trading $8/cwt higher, 5-600 lb steers established new record highs. Over the past month, 550 lb heifer prices have advanced $9/cwt. The steer/heifer calf price spread is the narrowest it’s been all year. The Western Canadian feeder index closed the week at $276.49/cwt, $7/cwt higher than the previous week. Alberta auction volumes totaled just more than 14,000 head, 6,000 head fewer than the same week last year. Canadian feeder cattle exports to the U.S. for the week ending April 1 totaled 3,003 head, 60% lower than the same week last year. The first quarter export volume stands second lowest over the past ten years, with 2021 as the only year that was smaller.

Alberta D2 cows traded $0.75/cwt higher than the previous week, and live trade was reported from $120‑143/cwt. D3 cows averaged $116/cwt. Butcher bulls traded $4.25/cwt higher, averaging $152/cwt, with a trading range from $130-176/cwt. Canadian butcher bull exports to the U.S. for the week ending April 1 totaled 541 head. Western Canadian cow slaughter volumes have just recently moved below year-ago levels.

Bull:

• Western Canadian packers are picking up cash cattle in one to two weeks; this is the shortest lift times have been in several months.
• Last Friday’s AB/SK cattle on feed report should be viewed as bullish.
• U.S. beef cutout values continue to advance, setting new annual highs.

Bear:

• YTD (January to February) 2023 U.S. beef exports are down 9% compared last year.
• U.S. pork retail prices have moved lower for five consecutive months.  
• There has been widespread talks that packers could further scale back hours in the coming weeks to fight narrowing processing margins.