Canadian Cattle Herd Declines

[la4angus]

Canadian Cattle Herd Declines

Statistics Canada is reporting a decline in the country's national cattle herd — the first decline in three years, according to the Canadian Press (CP).

According to CP, a survey of 10,000 cattlemen showed a 233,000-head drop this year, from 15.1 million head on Canadian farms in 2005 to 14.8 million head as of Jan. 1, 2006. However, the total is still more than 1.3 million head higher than pre-bovine spongiform encephalopathy (BSE) figures.

The report noted that, with the border reopening July 2005, exports of live cattle to the U.S. are approaching pre-BSE ban levels.

 

[MikeC]

What do this mean to you la4angus?

 

[la4angus]

Canadian Cattle Herd Declines

Statistics Canada is reporting a decline in the country's national cattle herd — the first decline in three years, according to the Canadian Press (CP).

It looks like there is still a big inventory to get worked thru. 233,000 hd drop isn't much in light of the 1.3 mil. hd. buildup from the BSE years.
I have to think that this extra tonnage on the market will cause
some drop in prices, especially since we are not shipping to Japan again.

This report doesn't show any breakdown as to the classes and wts. of cattle, but there are definitely feeders of all classes, ages and wts in the background.
If the feeders would market cattle about 50 lb. lighter on average this would help to support the market.

According to CP, a survey of 10,000 cattlemen showed a 233,000-head drop this year, from 15.1 million head on Canadian farms in 2005 to 14.8 million head as of Jan. 1, 2006. However, the total is still more than 1.3 million head higher than pre-bovine spongiform encephalopathy (BSE) figures.

With exports of live cattle to the U.S. approaching pre-BSE ban levels, the US will have to absorb big numbers of feeders to get the numbers back in line with what was coming into the US before the BSE days. Therefore the US will have to export bigger numbers of fats.

With no more than the report showed in what I posted earlier, I probaly did a lot of typing without saying anything. Just more or less thinking out loud.

As the saying goes, sometimes it's best to keep your mouth shut and be thought a fool than to open it and remove all doubt. ;-)

 

[MikeC]

especially since we are not shipping to Japan again.

This is the main thing that has me worried also. It will take years to win the Japs confidence back. Hope the "UP" cycle stays put til then.

 

[la4angus]

We should have a full report soon. So far I havn't seen anything thogh. When it comes in we will have more numbers to look at that may give us a better idea of what to look for.

 

[DiamondSCattleCo]

The report noted that, with the border reopening July 2005, exports of live cattle to the U.S. are approaching pre-BSE ban levels.

This is the line that I find very interesting right here. We're close to pre-BSE ban export levels, and we're not exporting OTM cattle.

What this says to me is that once the border is fully open, I don't think we're going to see a whole big bunch of change. Whats happening right now is the OTM stuff is staying home, and Canadian consumers are getting lower quality product to buy. Restaurants are especially kicking up a fuss here because they can't get near the volume of quality cuts as they used to.

So when that border opens, I don't think you'll see big hit to your prices. For one, Canadian cattle only comprise 4% of your market, and for another, I think we'll see some of the younger stuff finally staying home again, reducing the overall impact of the OTM cattle. There will be a short-term impact, as there are alot of packer owned OTM critters in the country, but I think it will be absorbed quickly.

As la said, there are considerably more variables to consider, but thats an early guesstimate.

Rod