Cattle producers are breathing a sigh of relief on the news that a work stoppage is being avoided at the Cargill High River beef processing facility.
Brian Perillat with Canfax notes the High River, Alberta plant is one of the biggest in Canada, adding it would have been pretty devastating to the market if it would have been closed for any amount of time.
He gave an update on the markets.
"Our fed markets, we saw a little bit of strength last week and we're anticipating some more strength this week. You know the U.S. markets rallied significantly in the last month or so, whereas Canada has only seen marginal increases....With competition and continued good demand for beef and cattle right now, certainly expect stronger prices heading into December," he said. "The challenge we got to watch is basis levels. Our culled cows, they are picking up a little bit, but we remain at a pretty big discount to the U.S. market for cows, fed cattle, calves and feeders. We might see a few more exports going forward and maybe a slowdown in imports. We're at a feed cost disadvantage and our prices are lower, so we could see a little bit more southern trade happening."
Perillat commented on the feed situation.
"The feed overall has been a challenge. Our calf markets have not been very robust either. They've picked up slightly from the lows there in November. It's the high feed cost. Imported corn and barley is extremely expensive...Hay and stuff is manageable. Luckily, we had an open fall and guys were just starting to get into some colder weather and feeding now. I think most of the cow calf guys are in somewhat better shape than they thought in midsummer when there was no grass around and shortage of feed. I think it's manageable. It's still going to be tight. It's still pretty costly if guys need to buy anymore supplemental feed if it gets cold this winter."
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