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Demand and prices up beyond expectations at cattle sales

Wet weather is limiting cattle traffic to the U.S. Midwest

The cattle market in Manitoba has been busy since the start of the New Year, with prices surprising in some cases, according to a buyer.

“We’ve seen since Christmastime a significant increase in the culled cow prices, the Canadian packers have upped their cow kill by quite a bit and demand was considerably stronger than what we expected it would be when we took the Christmas break,” said Rick Wright of Heartland Order Buying.

About 9,600 head moved through the bulk of the province’s auction marts in the week ended Jan. 25, up from the previous week in which around 9,200 were sold.

According to Wright, there’s been strong demand for lighter-weight cattle, which was a surprise. On the heifer side, prices have been severely discounted for anything carrying “excessive flesh.”

“Anything that is small framed and fleshy, which we’re seeing above-average number of those cattle coming in due to the decent winter that we’ve had, those cattle are being discounted,” Wright said, adding he’s been advising producers to watch the feed pail with the heifers, as it’ll cost them money if they get too fleshy.

Wright expects numbers to continue to be decent at auction marts for the next few weeks, which should help to sort out price differences. So far the market is following the same trends it did at the start of 2018.

Demand is currently shifting, though. In the U.S., there has been a lot of wet weather, leading to muddy pens, limiting the amount of cattle that can be kept.

“Although with the dollar the way it is right now the export demand is limited, but certainly the weather has pretty much stopped a lot of the Canadian cattle from going into the Midwest,” Wright said.

Demand is also still coming from Eastern Canada. Most of the cattle currently being shipped east were bought in the fall and backgrounded in pens in Manitoba. With pen space freeing up again, eastern buyers are filling them up again. According to Wright, most of the cattle heading east spend 90 days in pens in Manitoba before being shipped.

“It’s a little slow getting the fed cattle out of the lots; their pen space is an issue, everybody’s fairly tight,” he said.

Most of the heavier-weighted cattle are still making their way west to Alberta.

About the author

CNSC

Ashley Robinson writes for MarketsFarm specializing in grain and commodity market reporting.

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