Fall calf volumes lower than last year

Manitoba’s cattle auction yards were busy once again during the week ended November 9, as the fall run continued at full speed. Prices held relatively steady for the most part, although top-end bids for many classes of cattle were mostly lower, rather than higher, in many instances.

“We’re at the peak of the fall run right now,” said Dave Nickel of the Gladstone Auction Mart. His yard was operating at full capacity during the week, and is already booked up for the next sale after 1,360 head were on offer November 6.

Demand for Manitoba’s feeder cattle remained equally divided between eastern and western feedlots during the week, with some animals being kept locally to feed over the winter.

The fact that prices continue to hold relatively steady is largely a function of supply, instead of demand.

“The cattle just aren’t around like they were,” said Nickel adding that “I think we might run out of cattle this year.” He said total volumes for the fall run remain to be seen, but will most likely be down from 2011. He said the declining cow herd in the province was behind the trend.

In addition to people exiting the industry entirely, Nickel said producers in some areas have also reduced their herds this year due to a lack of feed. In those cases, if they don’t have enough straw to make it through the winter, he said there might be a few more cattle coming to market over the next few weeks.

Forage supplies are variable around the province, with very few producers with extra to sell. Demand from the U.S. is also making prices more expensive for what is available, said Glenn Friesen of Manitoba Agriculture.

“It will be very interesting this winter,” said Nickel on the variable feed levels. While mild winter temperatures would be good from a feeding standpoint, Nickel said his area could do with more snow cover this winter. Dugout levels are low and will need to be replenished.

Looking ahead, Nickel expected to see another two or three steady weeks of activity at the auction yards, before slowing down ahead of Christmas.

Prices for butcher cattle across the province held relatively steady during the week, with the age-verified animals continuing to see good premiums over those that are not verified.

The U.S. election was a feature in the background of all markets during the week, and the Manitoba cattle sector was no exception. With the dust settling after U.S. President Barack Obama’s re-election, there are a number of issues of interest to Canadian livestock producers that might see some movement once again.

U.S. mandatory country-of-origin labelling (COOL) rules are still in effect, despite being knocked down by the WTO earlier this year. The U.S. has until December to comply with the WTO ruling and make changes to the COOL rules, and the end of the election should lead to some movement on that front.

U.S. lawmakers will also need to approve a new Farm Bill some time over the next few months, after the old one elapsed in September.

Any changes to U.S. renewable fuels policies would also have an effect on the cattle sector.

In addition, the U.S. economy remains a key driver worldwide, and fluctuations in equities and the U.S. currency have the potential to swing cattle values as well.

About the author


Phil Franz-Warkentin - MarketsFarm

Phil Franz-Warkentin writes for MarketsFarm specializing in grain and commodity market reporting.



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