Source: Alberta Agriculture and Forestry
Jason Wood, provincial livestock market analyst, provides an overview of cattle and hog markets and slaughter cattle numbers.
‘Alberta cattle markets recovered and stabilized after the impact of COVID-19 disruptions on the beef supply chain last spring,’ says Jason Wood, provincial livestock market analyst with Alberta Agriculture and Forestry. ‘Alberta fed steers averaged $138 per cwt in 2020, down 7.5% from 2019 and 12.9% below the 5-year average’.
Following the recovery, the fed market remained range bound from July to mid-December. Wood says the third week of December was the first time since early June that Alberta fed steers closed above $140 per cwt.
‘Since the beginning of December, the fed steer market has gained about $180 per head, with an average price of $150 per cwt in the third week of January, 2021.’
Wood adds the Alberta steer calf market (500-600 lb) averaged $221 per cwt in 2020, up 0.5% from 2019 but 7% below the 5-year average. The Alberta yearling steer market (800-900 lb) averaged $179 per cwt in 2020, down 3.3% from 2019 and 9% below the 5-year average.
‘For 2020, western Canada total cattle slaughter was 2.417 million head, down 2.6% from 2019 but 9.8% higher than the 5-year average. Processing volumes recovered quickly following reduced rates during the April and May period. During the second half of 2020, fed cattle processing volumes exceeded pre-pandemic levels.’
Wood adds weekly western fed slaughter rates increased, totalling 2.01 million head for 2020, up 1.7% over 2019 and 14.2% higher than the 5-year average. Western non-fed (cows and bulls) slaughter was 317,590 head in 2020, down 23.9% from 2019 and 12.5% below the 5-year average.
The impact of COVID-19 was felt throughout the agriculture sector. In the spring of 2020, several new supports were introduced to help producers and industry recover from the direct impact of the pandemic.
‘This included the implementation of a new set aside program that helped the Alberta cattle industry manage slaughter-ready cattle that were temporarily displaced due to processing slowdowns. In Alberta, over 158,000 slaughter-ready cattle were received into the set aside program, providing a valuable benefit for the sector’, says Wood.
‘The impact of the pandemic on Canadian and Alberta hog markets has affected North American processing plants, reduced foodservice pork demand and increased the number of plant export permits that China has temporarily suspended,’ says Wood. ‘There are currently 10 pork and 2 beef Canadian exporters that have their export certificates temporarily suspended by China.’
The Alberta Index 100 hog price averaged $1.44 per kg (without grade premiums) in 2020, down 9% from 2019 and 6.7% below the 5-year average. For 2020, Canadian hog slaughter was 21.7 million head, up 4.2% over 2019. Alberta hogs for slaughter was up 8.5% year-over-year at 2.38 million head in 2020.
‘Alberta hog producers continue to be challenged by margins below breakeven. Lower market prices and higher feed costs have negatively affected producer margins,’ says Wood. ‘For 2021, enhanced packer contract offers and improving hog markets are positive signs for hog prices and producer margins.’
During 2020, COVID-19 significantly disrupted hog markets. The temporary shutdown of several hog processing plants reduced weekly processing volumes and delayed the marketing window of hogs in several locations across North America. This led to weakened hog prices and producer margins.
‘In response, several new supports were introduced to help Alberta producers and industry recover from the direct impact of the pandemic. For the Alberta hog sector, the interim payment under AgriStability was increased from 50 per cent to 75 per cent. Increasing the advance payment allowed hog producers to receive the equivalent of $20 per head for those enrolled in AgriStability’, says Wood.
For more information, contact Jason Wood:
Hours: 8 am to 5 pm (open Monday to Friday, closed statutory holidays)
Toll free: 310-0000