Stronger fed market supports feeder complex

For the week ending May 2, backgrounded yearlings traded steady to $5 per hundredweight higher on average compared to seven days earlier.

Calves and replacements weighing less than 700 pounds traded $10 higher to $15 per cwt. lower compared to the week earlier.

Supplies of calves weighing less than 600 lb. were limited, and only small packages were available. The market was hard to define for lighter calves.

The TEAM market report included 90 black long wide-frame steers with a mean weight of 930 lb. on a diet of cropped hay and eight lb. of barley with full veterinary records (implants and age verified) that sold for $489 per cwt. f.o.b. ranch near Piapot, Sask., for immediate delivery.

At the Perlich ring sale near Lethbridge, 62 medium to larger-frame tan yearling heifers averaging 917 lb. on full herd health program (no implants) traded for $453 per cwt.

At the Ponoka ring sale, 22 mixed steers weighing 817 lb. with processing records (no implants) on a diet of five lb. of barley and corn silage sold for $549 per cwt. The Killarney market report included a group of 52 Charolais heifers averaging 835 lb. that sold for $487 per cwt.

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The Northern Livestock Sales report from Lloydminster included 25 black steers averaging 722 lb. that sold for $599 per cwt.

At the Westlock, Alta., auction, 15 Simmental Angus cross, weaned heifers on the full herd health program coming off a diet of silage and hay sold for $541 per cwt.

At the Ste. Rose auction in Manitoba, a smaller package of red heifers averaging 611 lb. dropped the gavel at $616 per cwt.

At the Lloydminster sale, red steers weighing 627 lb. were last bid at $671 per cwt. and an eight-pack of black steers evaluated at 608 lb. exited the ring at $707 per cwt.

North of Calgary, a smaller package of weaned, Simmental cross steers averaging 505 lb. reportedly traded for $768 per cwt. Northeast of Calgary, a farmer reported that black Limousin cross, weaned heifers weighing 505 lb. were valued at $710 per cwt.

Alberta packers were buying fed cattle on a dressed basis in the range of $560-$565 per cwt., up $9-$10 per cwt. from the previous week. Live sales f.o.b. feedlot in southern Alberta were reported form $337-$339 per cwt.

For last half July delivery, the TEAM market report had 180 Charolais, red, mixed steers averaging 1,000 lb. on a controlled weight gain diet of rolled corn and silage that were priced at $468 per cwt. f.o.b. farm near Monarch, Alta.

Strength in the fed market has sustained feeder cattle prices at the current levels for all weight categories.

In Alberta, market-ready fed cattle supplies will increase over the next month.

In the U.S., market-ready fed cattle supplies are tightening. However, the Commitment of Traders Report tells us that U.S. packers have sufficient coverage. Packers are well prepared don’t need to buy many cattle at these record highs.

U.S. restaurant demand tends to make a seasonal highs during May and June. The wholesale beef market has factored in this stronger demand and is struggling to move higher.

Barley and corn prices continue to percolate higher, resulting in higher cost-per-pound gains.

U.S. corn acreage is uncertain. Fertilizer (nitrogen) prices are at historical highs, and we may see farmers switch acres from corn into other crops.