Beef Market Update: Canada on pace to break record of feeder cattle imports from U.S.

This episode of the Beef Market Update is brought to you by smartlake Supplements. As the seasons change, so do your herd's protein needs. That's where smartlake protein cups come in. Delivering weatherproof nutrition that helps cattle stay in condition, make the most of available forages and perform through winter, giving you peace of mind. It's now time for the Beef Market Update with Anewsco, the gateway livestock exchange. And how are we doing today? I'm doing good, Shaun. Good, good. You're all ready for Christmas. Well, as ready as we're going to be, let's just leave it at that. Okay? I'm tapping out. Okay, we've, we're at the, this is our last Beef Market Update, I think for the year maybe. Yeah. What a year we have had. Are we going out with a bang or is it kind of calm and from a cash market perspective, kind of calm. So not surprising, you know, heading into a holiday week next week. And packers in the US Bought a pile of cattle last week at that higher money. So, you know, this week to be quieter is not a surprise. So it looks like for the most part we're going to find the US trading steady. That means 228 live in the north, 357 delivered dressed. And I suspect we'll, we'll see trade in Texas and Kansas in that228,229 area when they get done today. So kind of quiet. Like I say, the choice cut out, it lost about 85 cents this week. So 357 and a quarter is where we're going to leave that at the slacks back about 13 bucks, Shaun, as we head into 2026. You know, I expect that cut out to kind of the first quarter of the year is never really a time to see that wholesale price do much of anything until we get into grilling season. You know, the focus goes from middle meats as we headed into the holidays this year to to more of the end cut to speed as we transition into Q1. So expect that to kind of be choppy. We do have one piece of report coming out this afternoon and that's the December 1st US catalon feed report. So the guesses for that report, and again this is mostly in the marketplace I would suspect, but on feed numbers, down 2% from last year is the expectations placements in November down 8%. And that just continues to show that lack of feeder cattle coming in from, from Mexico. So again, that's really impacting specifically the state of Texas in terms of where they're Lacking in terms of those cattle placements. And then the marketing number for November also down about. It's going to be down about 11%. And again packers weren't making money. So guess what they don't do when they're not making money? Don't kill cattle. So you know, really no big surprises. But that's what we head into this. Afternoon in the three legged stool here of course we have ranchers, feeders and packers. Is the dynamic still in place? Ranchers profitability is great. That's not in question. Cattle feeder making money and the packer on the losing end. Is that, is that still the way it is? Yeah, we're transitioning. So yes, on the cow calf side definitely that cattle feeder is now transitioning into higher place breakevens especially you know, here more so in western Canada. We'll see this a little later in the US in terms of 2026. So here in western Canada we're already starting to see that margin shift in terms of starting to see if you're selling on the cash market now you're starting to see some losses. It's been a great year but now, you know, depending on when and how you price cattle. But on average on the cash market it was a great year. But that's starting to change now. And on the packer for the, for the year of 2025, it's definitely going to be a negative here. Late this year when we saw the big swings and cutout and cash price moving around, there was some weeks of, plus some weeks of negative. But overall 25 will be a negative. Yeah, the packer probably will call 2025 a bit forgettable. Yeah, one of his worst actually. On average. One of his worst. Really? Yeah. Yeah. Okay, so it's not. So eight placements, 8% down is the expectation. So we get, we got some empty pens at a time when there's opport, you know, depending on what the prices are, there's opportunity for, for money making. That's gotta be kind of. That's an interesting business dynamic going on right now. Well, there was. Right. I think that's changed now as we head into the year looking at probably a little lower finished prices than we, you know, some of the big numbers we came through in the third quarter there, especially when we topped in October. So you know, that was frustrating obviously when you had the opportunities, especially for those southern Texas feed yards and they weren't placing the cattle. So again that's, it's going to be something that is hard to make up for. I suspect We've also got some trade. Numbers and for September where we, we, we imported some US feeder cattle into Canada. Yeah, again we talked about this a couple of months or a couple of weeks ago. In terms of after that government shut down in the U.S. you think, well, why is Canadian data behind but the two countries share their trade data. So just a reminder. So we're just catching up. We just got the September live cattle trade and beef trade for that matter. But I wanted to mention specifically the feeder cattle imports because in the month of September, almost 65,000 head of feeder cattle moved north from the US into Canada, mostly western Canada. That's 34% higher than September of last year. It's the second largest month ever. The only month to beat it was last November, November of 2024. And we still have Q4 numbers to come in. So we won't even get the October numbers, Shaun, until January. Stats can given us the schedule. So crazy. So already in the three quarters of this year, January to the end of September, we've imported 294,000 head of feeder cattle. That's a 20% increase over last year. And last year, when the calendar year finished, it was a record 400,000. So if the pace continues in Q4, which I can't see why it wouldn't, the reason the feeders are moving north in this particular case is the economics. Cattle feeders were still landing these cattle lower than what they were buying the cash cattle here in Western Canada. So if that, if that trend holds, we could be 480,000 on the year. Yeah, I don't know if I'd go 80, but yeah, certainly over 400, 000, you know, beat last year's record. I hate to put a number on it because I've also learned the speeder cattle import number can be pretty volatile. So it does bounce around and I haven't figured out quite how or why. But anyways. Yeah, what's kind of interesting to me is different things happening at both the north and the south border. Right. We got a million feeder feeders not coming into the US out of Mexico as you talked about that that's impacting that placement number. But at the same time, a lot of feeder cattle from the northern tier flowing into western Canada, that's. That, that definitely has an impact on the markets. That's a fascinating dynamic. Yeah, yeah. When you, when you look at that net supply of feeder cattle, especially in the US when you start talking about the, the dependence on the two countries of feeder cattle moving back and forth, Mexico And Canada, really interesting. And yeah, kind of makes one scratch their head and, and wonder why. And Alberta feedlots, those that follow Campax and get the, the western Canadian cattle on feed report. Our western Canadian feedlots have more cattle on feed today than a year ago. And this report we're going to get from the US today is calling their numbers down 2% compared to a year ago. So very interesting dynamic going on. Yeah, no kidding. And what's also interesting, with the North American trade flows, those US Feeder cattle being fed in Canada, they may still end up on a truck and being killed in the U.S. they also could end up in a box, too. So it's. That's. Yeah. In the U.S. fed in Canada, slaughtered in the. Yeah, it just makes you. It really, again, just identifies how complex the border is and how cattle move back and forth and, and beef for that matter. And we've talked about that lots of. So we've talked a lot about the record high beef prices in 2025. Do you have some context before we wrap up here? Some context on the, on the, on the different stages of the value chain here, how those prices are in 25 versus what we saw in 24? Yeah. Well, let's just talk about. It looks like. And these are Alberta prices, just to be clear, Fed cattle prices in Alberta 20% higher than last year on average for the calendar year. And interestingly enough, Shaun, the US will also be 20% higher. So the Fed markets both move together. That's. That's good news. And that's what we would expect. Feeder cattle prices on average, 30% higher calf prices. If we just look at October and November, the bulk of the calf run versus the bulk of the calf run last year. These are cash cattle, 50% higher. Whoa. 30$600 average on a five and a half weight versus last year that average was 24. So crazy, crazy D2 cows, 25% higher. That choice wholesale price that we follow in the U.S. 17% higher retail beef in Canada year to date, 11% higher. Beef exports down 3. Beef imports up 15. Those are your key numbers or. Those are some really key numbers to follow and really tell the tale of what happened in 25, which was a remarkable remark, remarkable year that I. Something I've never seen before. Yeah, and you've been in the game for a while. Just saying. I'm looking forward to our first beef market update in January of 26. We're going to look ahead. Okay, so we know this crazy 20, 20, 25. What will 26 bring? We'll do that in the next Beef Market Update in a couple weeks. And thanks so much for joining us here today. Really appreciate it. Thanks. Merry Christmas to you and everybody there. Thank you for downloading this episode of the Beef Market Update, brought to you by smartlick Supplements. Smartlick tubs make it easy to keep your herd on track. Consistent nutrition, less work and better results through winter. Feed smarter, not harder. Go to smartlick. Com, that's S M A R T L I C com to find your dealer.