Cattle producers have a lot to celebrate.
“Our prices for feeder and fed cattle are holding up quite well right now,” said Jason Wood, provincial livestock market analyst with Alberta Agriculture and Forestry.
No one could have predicted that the market would go as high as it did, he said.
“If we compare current prices to last year, we’re right on the line where we were with fed cattle/slaughter cattle,” he said, noting fed cattle in Alberta were quoted at $144 per hundredweight in mid-July.
Wood is not the only one who thinks that times are good.
The story in 2017 so far is a significant rally from last fall’s market woes, said Anne Wasko, market analyst with Gateway Livestock Services of Taber.
Sales of Western Livestock Price Insurance were up last winter and spring, and that proved to be a good move, she said.
“I think producers in Western Canada were certainly looking at that product, the price insurance product as one mechanism to at least put a floor on the prices,” said Wasko, who also raises cattle near Eastend, Sask.
“If the market went up, so did the coverage.”
There were similar opportunities to lock in good prices earlier this year.
“For those who were marketing on the spot market this spring and early summer, it’s been an extremely profitable time frame,” she said.
Those profits will have a lasting effect if producers opt to reinvest in their operation, whether that’s improving infrastructure or breeding lines, purchasing technology, or just reducing debt, she said.
Prices are high for both yearlings and steers, and wholesale cut-out prices are also high because of retail demand.
“That’s been good throughout the whole supply chain,” said Wood.
Pork and chicken prices are also relatively strong, which is actually a good news story for beef as it slows any potential rush to cheaper alternatives to beef.
The other thing that producers can raise a glass to is a third buyer in the province, now that Harmony Beef has opened its doors.
“That’s a good thing for producers,” said Wood. “Now we’ve got three packers looking for cattle.”
There could be good opportunities for producers to contract cattle this fall, he added.
The cow-calf sector is doing well, said Dave Solverson, a rancher from Camrose and past president of the Canadian Cattlemen’s Association.
Tremendous prices in 2014 and 2015 were followed by a substantial correction, but the recent rebound coupled with good pasture conditions across much of the province is a major boon, he said.
And last year’s poor harvest conditions for crop farmers produced an upside for cattle producers, he said.
“Most of our neighbours are grain farmers, and there is real opportunity for salvaging crops that get stressed from weather,” said Solverson, who has a small feedlot in addition to his cow-calf operation.
That actually began last fall, when there was significant hail damage in his area. And while no one likes to see crop damage, it’s a plus if there are cattle in the area that can salvage what’s in the field, he said.
“That’s one of the benefits of having a strong beef component to agriculture in the province,” said Solverson. “There’s opportunity to utilize feed that isn’t human quality anymore.”
And after a couple of poor years, haying is going really well this year.
Wood said the last report that he saw said hay production was excellent, with Alberta at about the five-year average on production per acre. Quality has also been excellent overall, he said.