Canfax Weekly Article | Report for the week of June 6, 2022

Last week’s large speculative cash offering saw lackluster buying interest, and procurement volumes were limited. The bulk of dressed sales were reported steady to $2/cwt lower than the previous week at $288-289/cwt delivered. Weighted average prices were generally $1/cwt lower than the previous week. June kill schedules have been booked up and deliveries are now spilling out to the first and second week of July. Western Canadian fed slaughter for the week ending May 28th was 1% larger than the previous week and YTD volume was up 5% at 896,514 head. Canadian fed cattle/cow exports to the U.S. for the week ending May 21^st totaled 8,769 head and YTD export volumes are up 13% from last year.

Weekly Alberta auction volumes totaled just over 20,000 head, for the beginning of June this is the second largest volume over the past decade. The situation is becoming similar to last year, where grass cattle that would not be marketed or gathered off of pasture until the summer are moving into feedlots 60-90 days earlier than normal. In some instances, grass cattle are not even being turned out to summer pastures, instead they are going directly to the feedlot. On the cash market, heavier weight heifers continue to be a tougher sell compared to the steers. This week the price spread between 850 lb steers and heifers is $21.50/cwt.

Dry pasture conditions continue to force many cow/calf producers to cull harder than normal for this time of year. There was a notable increase in non-fed volumes through auction facilities last week. Despite larger numbers, butcher cows traded steady to $2/cwt higher through the ring and dressed bids/sales were $5/cwt higher. Alberta bull and Ontario cow prices established new annual highs last week. Ontario cow prices have gained $4.50/cwt over the past two weeks, averaging just over $111/cwt. There have been a few late summer/fall bred cows on offer, and demand remains weak. Most of these bred cows are going to slaughter.

Bull.

• AAA and Prime as a percent of all A grades is over 7.5% higher than the 5-year average at 69%.
• Ontario feedlots are trending very current and are gaining market leverage.
• Some major grilling season holidays are on the horizon.

Bear.

• Packers continue to push inventories further out.
• Cutout values are seasonally toppy.
• Dry conditions persist across much of Western Canada.

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