Canadian Feeder Supplies Continue to Grow

Canadian fed cattle prices continue to rebound as boneless beef exports have increased and continue to clear Canadian cooler inventories.  Last week, fed cattle prices in Alberta averaged about U.S. $68/cwt., but were still $5/cwt. below a year ago.  During October, Alberta cattle slaughter was down about 15 percent compared to a year ago. 

Steer carcass weights averaged 877 pounds last week (up 92 pounds in five months) versus 806 pounds for U.S. steers.  Year-to-date, average Canadian steer carcass weights have increased to 829 pounds — even with a year ago.  This year Canadian production is down about 15 percent.

Since the U.S.-Canadian border opened to beef trade in early September, imports of Canadian boneless beef have been slow to return to near year-ago levels and have been running between 10 to 15 million pounds per week during October.  This is about half to two-thirds of normal.  Imports of Canadian beef are not expected to grow much past this level as long as Canadian slaughter totals and cattle-on-feed numbers remain well below year-ago levels.

Canadian feeder cattle and calf supplies outside of feedlots continue to grow and at the end of October are expected to be about 650,000 to 700,000 head larger than a year ago.  October Canadian placements are expected to be down about 20 percent compared to a year ago and down nearly 35 percent, compared to October 2001.  Since August, Canadian placements are expected to total about 785,000 head, vs. 985,000 head last year.

Bottom line:  The number of Canadian feeder cattle and calves that will be available for export when the border opens will largely depend on how many are placed during the next four to six months and how many of these cattle are slaughtered without being placed in feedlots.  Both placements and slaughter of these cattle will have to increase substantially between now and the border opening to prevent a large increase in Canadian feeder cattle and calf supplies.