On previous episodes of the Beef Market Update, you’ve heard Anne Wasko of the Gateway Livestock Exchange talk about the cattle hangover that is going on in the fed cattle market. Well, we’ve got some good news: we are on our way out.
Wasko says although the U.S. is getting on its feet too, the Canadian marketplace for fed cattle is getting more current, quicker than the U.S.
“We are ducking out from underneath it, with smaller and more current supplies ahead. Carcass weights are down, too,” says Wasko.
As we sit at mid-June already, we really are getting into prime BBQ season; restaurants are beginning to reopen, and some social gatherings are allowed across the country, which is creating a good demand story. However, Wasko does remind us that when it comes to demand and consumption data, it has always lagged.
“We just got some consumption data from StatsCan last week, and it’s for 2020, but I think some of the same fundamentals that I’ll just remind listeners of, are carrying on here in 2021 — but in 2020, Canadian beef demand was up five and a half per cent from 2019,” says Wasko.
This wasn’t much of a surprise as we went through COVID-19, and saw how strong prices were at the counter. History also shows that when consumers have that extra spending cash — that they weren’t using at the restaurants — they tend to spend it on a cut of beef to cook up at home.
“The demand story is very positive — third best demand index in recent history — only behind 2015 and 2016. So the consumption data that StatsCan released last week, also for 2020, also supported that good news story. And one was that per capita beef consumption, in Canada, was actually up 0.3 per cent versus 2019, and that goes up against what everyone is talking about, that people are eating less meat. And when it comes to staying home, and having more money in our pockets because we’re not spending, we’ll spend it on beef,” says Wasko. “The beef story was a super story all around.”
Here the full conversation below: