CANADIAN CATTLE ON FEED

Last week CanFax reported that the August 1^st number of cattle on-feed in Alberta and Saskatchewan feedlots (1000 head or more) was 671,700 head, 5% more than last year, but nearly 8% below the 2004-2009 average. Canadian feeders enjoyed an advantage in feeding margins earlier this year relative to the U.S., one reason for the larger number of cattle on feed. According to the report, feeders placed about 5% less cattle than last year during July and 35% less than the prior five-year average. On a seasonal basis, July is the lowest placement month for Canadian feedlots. During July, CanFax reported feedlot marketings at 173,900 head, about 25,000 head or 12% below 2010’s.

In July, CanFax reported total steer and heifer slaughter at 206,900 head, about 11% less than 2010. Most of the year-on-year decline was due to fewer heifers in the slaughter mix (down 24%) compared to steer’s (down about 4%). So far this year, total steer and heifer slaughter has been down over 11% compared to last year. In July, total beef production dropped 11% compared to a year ago, with production down 13% year-to-date due to lower cow/bull slaughter and lighter cattle dressed weights.

Smaller supplies have contributed to higher fed and feeder cattle prices this year. Alberta fed steer prices averaged 15% higher than a year ago, with prices year-to-date up just over 20% from 2010’s. January through July, compared to a year ago, prices for lightweight (550 lbs) feeder steer prices were up over 28%, with heavyweights (850 lbs) increasing 22%. In Ontario, fed steers prices averaged nearly 14% above 2010’s in July and are up nearly 18% so far this year. Feeder steer prices for lightweights increased 23% year-to-date, while heavyweights were up 21% from last year. Note, Ontario fed steers on average receive about a 5% price premium over Alberta fed steer prices, while feeder steers prices are on average 2% lower.