Canada’s March 1 cattle on feed numbers declined from a month earlier and remain locked between last year and the 2017-2021 average, according to CanFax.
CanFax is a private market advisory group that collects the on-feed data from member feedlots in Alberta and Saskatchewan. Most of the results are shared only with members, but CanFax does share the on-feed and placement totals with the Livestock Marketing Information Center in Denver for compilation and general distribution on its website.
ON-FEED NUMBERS ABOVE AVERAGE
Canada’s on-feed totals were unsurprising to analysts, remaining higher than the 2017-2021 average and less than those of last year, at 1.035 million head. This was down 15,000, or 1.43%, from February’s 1.050 million, down 59,000, or 5.39%, from last year’s 1.094 million but up 68,371, or 7.07%, from the previous five-year average of 966,629.
In declining from the Feb. 1 total, Canada’s on-feed number followed the 2022 trend for the same time period. It would have increased had it followed the 2017-2021 average.
However, there is a strong seasonal tendency for the on-feed numbers to rise into an April 1 seasonal high before rolling over into a summer slump. The annual low is recorded on Sep. 1, following which, the on-feed numbers rise sharply to a Dec. 1 annual high.
Last year’s on-feed numbers followed the seasonal trend, although at a higher level. But the difference between them narrowed as the near progressed. If the numbers narrow again, it would be possible for this year’s on-feed number to dip below the five-year average line on a graph, especially since placement rates are falling behind increases shown last year and the average.
PLACEMENT RATE DECREASES
While placements went up in February from January, the rate of increase was less than that of a year ago and especially that of the previous five-year average.
February placements totaled 128,590 head, up 4,289, or 3.45%, from 124,301 in January but down 10,956, or 7.85%, from 139,546 a year earlier and down 5,811, or 4.32%, from the average of 134,401.
For comparison, February placements last year were up 8,632, or 6.59%, from January, and the five-year average February placement rate was up 31.0%.
There is a strong seasonal tendency for March placements to rise to a seasonal peak, the second-largest peak of the year, so it would be very unusual for March placements this year to violate the trend.
However, March placements could falter and be less than either last year or the previous five-year average.
The trend after March is for monthly placements to decline into the July annual low before rising to the October annual high.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $165.37 to $165.72 per cwt, compared with last week’s range of $164.13 to $166.59. FOB dressed steers, and heifers went for $260.45 to $260.89 per cwt, versus $258.17 to $264.02.
The USDA choice cutout Monday was down $0.05 per cwt at $284.86 while select was up $2.08 at $273.62. The choice/select spread narrowed to $11.24 from $13.37 with 59 loads of fabricated product and 24 loads of trimmings and grinds sold into the spot market.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged to up $0.05 at $1.60 to $1.70 a bushel over the May corn contract. Bids in Kansas were steady at $0.75 over May, which settled at $6.13 1/2 a bushel, down $0.03 3/4.
The CME Feeder Cattle Index for the seven days ended Friday was $189.77 per cwt, up $0.94. This compares with Monday’s Mar contract settlement of $190.82 per cwt, down $0.65.