Canfax Weekly Article | Report for the week of February 28, 2022

Last week the Canfax fed steer and heifer price closed around $161.75/cwt, $1.75/cwt higher than the previous week. Fed cattle prices have strengthened for three weeks in a row, gaining $5/cwt. Last week dressed sales were reported from $269.00-273.50/cwt FOB lot. Cattle that traded last week were being scheduled for the week of March 28th delivery. Alberta fed prices are trading at a significant discount to both the Ontario and U.S. market. 

The Canfax average feeder steer price closed the week $1.75/cwt higher while heifer prices were steady. Last week steers weighing from 5-700 lb traded $3/cwt higher, and same weight heifers traded steady to $1/cwt stronger. Since the start of the year, 5-600 lb steer/heifer prices have increased $16-19/cwt. On a cash-to-cash basis Alberta calf and feeder prices are trading at a discount to the US market. Western Canadian calf and feeder indices closed the week at $223.91/cwt and $197.82/cwt respectively. Alberta weekly auction volumes totaled just under 29,000 head last week. Canadian feeder cattle exports to the U.S. for the week ending February 12 totaled 7,371 head.

Alberta D2 cows traded $4/cwt higher last week and live trade was reported from $78-96/cwt. D3 cows averaged $76/cwt. Cows are trading at the highest point since July. Butcher bulls traded $3.50/cwt higher to average $110.75/cwt and live trade was reported from $95-129/cwt. Canadian butcher bull exports to the U.S. for the week ending February 12 totaled 462 head.

Bull.

• Based on the five-year average, Alberta fed cash to futures basis levels historically strengthen from February to March.
• The Choice beef cutout/pork cutout ratio has narrowed suggesting beef is competitively priced at the wholesale level.
• Non-fed volumes through commercial auction facilities are tightening and slaughter volumes will start to moderate as well.

Bear.

• U.S. beef stocks in cold storage for the end of January is historically large.
• U.S. February 1 cattle on feed inventories are record large.
• Canadian fed beef production for the first half of February has been record large.

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