RealAg LIVE! with Brian Perillat on the cattle markets

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How about those cattle markets? Everything is on the move and demand is there, but getting the cash back to the producers at the end of the day has been tricky.

To break it all down on this RealAg LIVE! host Shaun Haney is joined by Brian Perillat of CanFax.

Don’t miss a new RealAg LIVE! each weekday at 3 pm Eastern!

SUMMARY

  • The recovery out of COVID-19 looks phenomenal
  • We’ve gotten through the bottleneck of packing capacity
  • Still lots of cattle on feed
  • Feedlots right now don’t have the bargaining power they need
  • Cutout value has been very, very strong
  • Record high beef sales right now
  • China is continuing to buy larger and larger amounts of beef from North America
  • There’s massive frustration out there, when you are looking at packer margins, and feedlots are still losing money
  • Bill 50-14 that may pass in the U.S., has Canadian producers thinking
  • Access to data is tough in the cattle industry
  • We need some sort of industry price push for transparency
  • Everyone’s got different ideas, and it’s tough to get one rolling. They really tried five to six years ago
  • Strong exports — they are expecting that trend to continue, and likely grow
  • Japan has similar tariff rates, but they had a cap last year, so it makes it quite different
  • Hoping to get our BSE risk status down so we can expand into countries like South Korea
  • We’re selling more beef, and we’re doing it at higher prices. The export market is continuing to eat it up
  • Domestic demand is strong, despite the fact that restaurants really haven’t been open for quite some time
  • Feeder cattle pricing has been a strong market. There’s a lot for the feed market to sort out
  • Headed into three years of losses for feedlots. And yet these feeder prices haven’t adjusted
  • We added 15 per cent in bunk capacity in feedlots across Canada this year
  • There were some opportunities earlier on with the futures rallying
  • From a pure economic stance, it doesn’t necessarily make traditional sense
  • How aggressive should we be on purchasing feed right now? It’s a challenge
  • Canadian dollar has reached 82 cents. Hoping there’s some resistance at 83 or 84 cents, from a pure technical stance. It’s been on an uptrend, and continues on an uptrend
  • Basis levels — we’ve certainly got the challenges with markets. But not as challenged as the United States
  • Cattle futures want to anticipate higher prices
  • Dry conditions drop down into places like North Dakota and Manitoba. Grass conditions are something that everyone will be watching closely throughout the summer
  • Is there an incentive for the beef packers to expand on the capacity they have? Maybe its the weather play or the risk that is causing this not to happen, yet
  • North American cattle herd certainly isn’t getting any bigger
  • Looking to find out more from CanFax? Check it out, here

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