Canfax Weekly Article | Report for the week of March 21, 2022

Cash market buying interest was not surprisingly sluggish last week following the 72-hour CP Rail lockout notice, but moderate volume trade did develop. Dressed prices trended steady to firmer with the bulk of sales reported from $274-275/cwt delivered. Weighted average steer prices closed the week $1.66/cwt higher than the previous week averaging $163.38/cwt and heifers traded steady. Western Canadian fed slaughter for the week ending March 12th was down 10% from the previous week to 42,545 head, but remains 5% above the same week a year ago.

Trading anywhere from $3-8/cwt higher AB, SK, and MB steers weighing from 5-700 lb established new annual highs. Numbers are not huge, but compared to January and February, we are starting to see a few more calves and feeders from Manitoba heading west into AB/SK versus going into Ontario. There have been numerous reports with short feed supplies, grass operators are waiting longer than normal to purchase their grass cattle. Forward delivery prices for grass yearlings remain historically strong which should be price supportive to the stocker market. The forward delivery market was lightly tested, this week Alberta 1000+ lb steers for September delivery traded over $200/cwt.

YTD cow slaughter in western Canada is 3% lower than last year, while in eastern Canada cow slaughter is 26% larger. Since the start of the year eastern Canadian cow prices are 25% higher than last year and have been at a premium to the Alberta market for the better part of this year. Stronger salvage prices could be motivating producers in the east to cull harder. In Alberta, butcher cow prices have rallied for the past six weeks averaging just under $95/cwt. Instead of negotiating a price with the packer, producers are selling them through the ring. Trading $2.50/cwt higher this week butcher bull prices are at the highest point since August 2020.

Bull.

• Grilling and food service beef demand is improving.
• Western Canadian cow slaughter is moderating as packers appear to be prioritizing fed cattle.
• Feedlot placements in January and February were below year ago.

Bear.

• CP Rail has issued a 72-hour lockout notice to its employees.
• Recent inflation could price beef off of many shopping lists.
• Packer slaughter inventories are ample.

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