With fat cattle prices in Alberta $40 lower than they were a year ago, the view from where the cattle feeders will be sitting come this fall’s sale season will look different than it did in 2015.
“Estimated losses in July for cattle finishing in Alberta on a spot-to-spot basis are about $350 to the negative, whereas a year ago, he was selling cattle in the upper 180s and making 100 bucks a head,” explains Anne Wasko of Gateway Livestock in this latest Beef Market Update.
Packers having been profitable all year long, so cattle movement has been strong and carcass weights have been kept in check as feedlots are current, but the futures market still says “lower prices ahead,” notes Anne.
“Fundamentally we seem to be doing things quote ‘right’, but we certainly need these technicals to come in line as well to give this market some confidence, which it’s most certainly lacking.”
In searching for some good news, she says she found some in Canada’s beef trade numbers, as year-to-date exports through May were up eight percent on tonnage. May alone was up 17 percent from 2015, largely thanks to movement into the U.S.
There’s also good news for the domestic industry on the import side, as volumes through June — the first half of ’16 — were down four percent, with less beef coming from Australia, the Uruguay, and more-surprisingly, the U.S.
Listen to Anne’s conversation with Shaun Haney above, and subscribe to Real Ag’s free weekly cattle newsletter here.