Canfax Weekly Article | Report for the week of January 8, 2024

Many feedlots have indicated a large percentage of their cattle for the first quarter of this year are contracted and cash numbers will be light. With packers having a large percentage of their cattle procured via contracts, cash leverage has been limited and this trend might continue over the next couple of months.

Over the past couple of weeks, competition on the cash market has been disappointing and sale volumes were too light to establish a weighted average fed price this week. Dressed sales and bids were reported from $360-365/cwt delivered, $3-5/cwt lower than two weeks ago. YTD 2023 Western Canadian fed slaughter is six per cent lower than last year.

Many auction facilities did not run during the first week in January, and a Canfax feeder price was not established last week. Last week, 900+ pound feeders that traded via electronics were reported from $291-308/cwt, prices were stronger compared to the end of December.

Last week, barley sales delievered in southern Alberta were reported from $305-$310/tonne. Barley prices are at the lowest point since early 2021.

Alberta auction volumes totaled 160 head, 1,500 head lower than last year. Canadian feeder cattle exports to the U.S. for the week ending December 23, 2023, totaled 1,530 head, steady with the same week last year.

Auction volumes were limited last week and an average price for D2, D3 cows and bulls was not established. Compared to the second half of December rail cow bids were $5/cwt softer ranging from $250-255/cwt delivered last week.

Western Canadian cow slaughter for the week ending December 23, 2023 totaled just over 8,600 head, 19 per cent larger than the same week last year. Canadian butcher bull exports to the U.S. for the week ending December 23 totaled 372 head. Canadian slaughter bull exports to the U.S. have been below last year in 13 out of the past 14 weeks.

Bull

• Forward beef sales for 22-90 day delivery were strong in December
• According to the United States Department of Agriculture (USDA) total beef in cold storage for the end of November is 13 per cent lower than last year
• Based on a few industry estimates U.S. beef production in 2024 is forecasted to be down anywhere from 3.5-4.8 per cent compared to last year

Bear

• From Tuesday to Thursday, choice beef cutout values have dropped over $13/cwt
• Western Canadian carcass weights are record large averaging over 990 pounds
• Western Canadian packers are comfortable bought out in front