Producers ship cattle ahead of muddy season

Large volumes of cattle moved through Manitoba auction yards during the week ended March 16, as good weather conditions had producers looking to move the most animals seen yet this spring.

“We had big volumes in Manitoba this week,” said Rick Wright of Heartland Order Buying. From a pricing standpoint, larger animals over 750 pounds were under some pressure, but lighter cattle, especially those suited to go to pasture, were steady to strong.

“There was also really strong demand for replacement heifers,” said Wright, noting that many heifers were being bought by local cow-calf producers for breeding purposes, with buyers from Alberta also coming forward for those animals. “We’re shorting the number of cattle available to the feedlots,” said Wright.

The increased retention of heifers “shows there is some optimism and may be the start of rebuilding,” said Wright.

Normally at this time of year there would be two heifers for every steer in the marketplace, said Wright. However, with more heifers also being held back on farm, it is more of a 50-50 split this time around.

As the spring goes on, there will be fewer animals coming into the market, according to Wright. He said there were already very few backgrounding cattle for sale, with all of the cattle bought in the fall seeing retained ownership. Rather, the animals for sale during the week were primarily “farm fresh calves” changing ownership for the first time.

With the sudden start to spring, the good weather meant the cattle were clean and dry, and producers were moving them before the mud gets too bad and devalues them, said Wright. He expected volumes would likely be a little smaller over the next few weeks, before another wave comes through toward the end of April.

In the slaughter market, good-quality cows were fully steady to a little stronger, although the finished cattle were dragging, said Wright. He said there was “lots of meat in the pipeline,” and noted packers are about two to three weeks behind in their operations.

With the large numbers available, the feedlots would like to be bringing in more cattle, said Wright. However, the buyers find themselves in a bit of a “catch-22” situation, as the slowness on the processing side means the feedlots can’t get rid of their fat cattle for a few weeks and there is no room for the current slate of feeder cattle.

High feed grain prices were also tempering the enthusiasm of some buyers during the week. Usually feed grain prices and cattle prices operate at an inverse to each other — when one goes up, the other goes down. However, with both looking strong for the time being, Wright said it was only a matter of time before one or the other breaks lower.

“Guys are not making any money on a lot of the fats,” he said.

The weather continues to be watched closely, and while it’s still early the general dryness across many areas of Manitoba means pastures will require some surface moisture over the next few weeks to get going.

Wright said many cattle producers in Manitoba would like to turn the cattle out as early as they can, but are still in need of some moisture for the pastures.

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Phil Franz-Warkentin - MarketsFarm

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

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