Prices for cattle at auction marts across Manitoba were sharply higher on the week, leading to an influx of cattle, touching “unheard of” levels in some areas, according to one local auctioneer.
“Quite often, by the time we’re at the end of April we’re getting into those 400-, 500-head sales,” said Allan Munroe of Killarney Auction Mart.
The mart’s April 24 sale featured 970 head. “That’s unheard of, for us,” Munroe said.
Sharply higher prices for cattle spurred increased volumes, he added.
“The market is getting up, and guys are a little bit behind, and they’re cleaning house,” he said, adding that some ranchers who were planning to take cattle to grass opted to sell them instead, due to strong pricing.
Volumes weren’t higher at all sales in Manitoba, due to seasonal factors, though strong prices were consistent across the province.
“In our area, the volume is technically down. We’re getting to the time of year where most of the cattle have been moved already,” said Dave Nickel of Gladstone Auction Mart.
Strong futures and demand for cattle propped up values at his sale, he added.
Chicago Mercantile Exchange cattle futures advanced leading into Munroe’s sale on April 24. “And the futures board has gone basically up every day since. It’s extremely bullish, which is always a good thing,” he said.
Declining carcass weights are one key source of that strength.
“That helps,” Munroe said. “When you start taking pounds off the carcasses it takes a lot more heads to get the same amount of beef.”
Sharp declines in the Canadian dollar on the week have also been supportive for the country’s cattle market.
The loonie lost slightly less than one U.S. cent against its U.S. counterpart in the week ending April 28, closing at 73.19 U.S. cents. That makes Canadian commodities more affordable internationally, and appealing to U.S. buyers.
Conditions for Manitoba cattle ranchers outside of auction marts are also favourable.
“Moisture is good, we’re starting to get some sunshine. I think we’ll have some grass around, right now things are positive,” Munroe said.
However, the cyclical nature of the cattle market means producers should look for opportunities to cover themselves going forward.
“I’m certainly, with a lot of other people, encouraging producers to look at price insurance,” said Munroe.
“We listen to analysts, and all fall and early winter, markets were supposed to keep dropping and it’s been rising, so we don’t know what’s going to happen by fall time.”