Rising prices for fuel and feed are cutting into cattle prices, Brad Kehler of the Grunthal Livestock Auction Mart said.
Fuel prices have skyrocketed due to Russia’s invasion of Ukraine and the subsequent ban on Russian oil imposed by the U.S., Canada and other countries. Regular gasoline in Winnipeg ranged from $1.669 to $2.019 per litre on March 11, according to one website. Prices elsewhere in southern Manitoba were often $1.70/litre and more.
Wheat prices as well climbed sharply, as Russia and Ukraine are the world’s No. 2 and No. 4 exporters. With both countries’ grain movements out of the Black Sea effectively cut off, the global market has clamoured for alternative sources, which generated massive price increases on a daily basis. That said, steep declines in the following few days highlighted the market’s refusal to sustain those extremely high prices.
Nevertheless, feed wheat prices in Manitoba jumped 50 cents per bushel, at $9.50-$10/bu. according to Prairie Ag Hotwire. Meanwhile, feed barley stepped back 38 cents/bu. to be around $9/bu.
“It’s costing a lot to transport these cattle. It’s costing a lot to feed them. It’s putting pressure on the cattle market for sure,” Kehler said.
While the Prairie cattle industry has been importing large quantities of corn from the U.S., Kehler noted that’s not the case in Manitoba. Rather, producers are relying on corn grown provincially for silage.
At Grunthal, feeder cattle prices have remained mostly steady over the last couple of weeks. Light steers were $191-$253 at the March 4 sale and $206-$242 on March 10. There was an insufficient number of heavy steers this week to make a comparison.
Heavy heifers changed a little, from $145-$161 last week to $140-$160 on March 10. The light heifers also changed slightly, from $175-$203 on March 4 to $179-$200 this week.
As the market advances closer to spring, Kehler also pointed out the number of cattle headed to auction will soon begin to decline.
“Our numbers have been holding so far, but I would say the numbers are to be going down here shortly,” he said.
The number of head going through Grunthal fell from 807 at the March 4 auction to 571 on March 10.
“Most of the cattle have been moved out already. There are a handful of groups left out there, but for the most part, most of the cattle have been sold already,” Kehler said.
