Klassen: Negative margins weigh on Western feeder cattle market

For the week ending April 4, Western Canadian feeder cattle prices were quite variable. Backgrounded replacements were relatively unchanged, however fleshier groups experienced sharper discounts compared to a week earlier.

Genetic quality appeared to influence the market on a larger scale for feeders under 700 pounds. Medium to larger frame preconditioned calves appeared to trade steady to $10 higher on average but “run of the mill” bawlers were steady to $10 lower. If feeders had more risk on feed efficiencies or health, the market priced these cattle with appropriate discounts.

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The TEAM market report included a group of 305 black steers with a mean weight of 1,000 pounds on barley, silage and supplement diet with full herd health records including implants sold for $455/cwt fob farm near Allan, Sask.

Northwest of Saskatoon, a pen-sized group of medium to larger frame mixed steers averaging 910 pounds, carrying various butter levels, on barley and silage diet with full processing records traded for $470 fob farm. South of Edmonton, a half-pen of larger frame Angus cross heifers on rolled barley and barley silage diet, with full processing and implants, averaging 875 pounds traded for $464 fob farm.

At the Ste. Rose auction, a smaller package of red mixed steers averaging 826 pounds traded for $507. At the same sale, a 10-pack of red and black heifers evaluated at 826 pounds sold for $459/cwt. In Ponoka, a group of eight lower flesh, 810-pound Simmental cross steers on barley and silage diet for two weeks, with full processing records traded for $525/cwt.

The Vermilion Livestock Exchange reported that five tan steers scaled at 723 pounds traded for $573/cwt. Fourteen tan heifers averaging 737 pounds dropped the gavel at $515/cwt.

The VJV report from Rimbey included a group of 14 mixed steer calves weighing 611 pound coming off a diet of cereal silage, chopped hay and oats, with full processing data were last bid at $655/cwt. In central Alberta, a producer reported at group of mixed weaned heifers averaging 620 pounds with full preconditioning records on silage and limited rolled barley exited the ring at $620/cwt.

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At the Vermilion sale, a six-pack of 550 pound tans steers traded for $734/cwt and 11 red-white-face 500 pound steers sold for $768/cwt.

At the Ste. Rose, Man. auction, a pair of red and black steers weighing 432 pounds silenced the crowd at $842/cwt. The volume of calves under 550 pounds was limited across the Prairies, which made the market hard to define.

Alberta packers were buying fed cattle on a live basis at $325/cwt fob feedlot in the Lethbridge area. The breakeven price on these finished cattle is around $355/cwt. This is the fifth consecutive month of negative margins for Alberta feedlots.