Cattle marketings pick up after slow period

Source: Saskatchewan Agriculture and Food

Across Saskatchewan, cattle are on the move. After months of lower trading volumes, a number of factors have combined to create a spike in movements.

Saskatchewan Agriculture and Food’s Beef Economist Sandy Russell is reporting a significant increase in the number of feeder cattle coming to market in the past weeks.

The movement started in the second week of February, with 18,500 head being traded, compared to 8,400 the week before.

The strong numbers continued, with subsequent weeks seeing cattle trading volumes of 21,000 head and 25,000 head.

Russell says there are a number of factors driving the increase.

“Coming into these past weeks, we hadn’t moved as many cattle as we traditionally see in the fall, or even in the early part of 2007. So it was overdue to have these larger numbers coming through,” said Russell.

Russell says a big reason for the lower numbers was market prices.

“From about the first week of September to the end of the year, prices were on an almost continual decline. So that was sending signals to producers, who decided they just didn’t want to market their cattle at the prices being offered. Prices were pretty steady in the first few weeks of the year and volumes were small, as is usually the case,” explained Russell.

Then, in mid-February, prices started to rise and producers started to respond. “That is what started pulling cattle to town,” said Russell.

But weather was also a key factor. “If it’s minus 40, neither the handler nor the cattle want to move. When it is cold and storming, that affects the ability to move cattle to the market, but it also affects those who are buying the cattle,” she stated.

“When the weather is good, more cattle will move.”

The larger volume may be a considerable increase, but is still well short of what the market can handle. Russell points out that, during the peak of the fall run, Saskatchewan auction markets typically handle more than 40,000 head a week.

But she says the bigger issue is the market impact of large volumes of cattle coming to town at the same time.

“Any time supply is great in a marketing situation, you do not want all the cattle coming to market at once. One must always consider the number of buyers on the market,” she said. “An abundance of cattle for sale all at the same time can put downward pressure on price.”

For more information, contact:

Sandy Russell, Beef Economist
Saskatchewan Agriculture and Food
Phone: (306) 933-5570
E-mail: srussell@agr.gov.sk.ca