There were no Western Canadian feeder cattle sales for week ending December 27. The shortened holiday week is always a time for cattle producers to call in and discuss factors that will influence the feeder market over the next couple months. In the short-term, finishing feedlot margins are the main factor driving the feeder market.
Alberta packers were buying fed cattle on live basis at $294/cwt on December 22, unchanged from the previous week. Breakeven pen closeout values for December are around $306/cwt. Alberta feeding margins have slipped into negative territory after favourable returns during the summer and fall of 2025.
It’s important to realize that the breakeven fed cattle price for April 2026 is in the range of $352-$355/cwt. Fed cattle prices need to rally by nearly $60/cwt from current levels for feedlots to experience positive margins in the spring timeframe.
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CBOT Weekly: USDA predicts declines in planting intentions
Declines in projected planting intentions for 2026/27 were not as big as the market expected, after the United States Department of Agriculture released its estimates on March 31. The USDA also issued its quarterly grain stocks report with stocks for soybeans bigger than anticipated, while those for corn were smaller and wheat virtually matched the average trade guess.
Feedlot margins will have a large influence on feeder cattle prices moving forward. During the second week of October 2025, larger frame higher quality steers averaging 900 pounds in Central Alberta were trading at $500-510/cwt.
During the first half of December 2025, higher quality 900-pound steers were valued from $455-$465/cwt. Calves have also come under pressure. In mid October, 600-pound tan steers were priced at $650/cwt in Central Alberta. During the week ending December 13, Charolais steers weighing 600 pounds were valued at $595/cwt.
Feed barley prices are also expected to strengthen over the winter. The year-over-year increase in feed barley exports will result in lower supplies later in the crop year.
Finally, we have a bullish outlook for the Canadian dollar. The Canadian economy has performed better than expected in the latter half of 2025. Canada’s trade balance has also turned into a surplus after running high deficits in the first half of 2025. This naturally results in more demand for Canadian dollars. Feedlot margins will be influence by higher barley prices and a stronger exchange rate moving forward.
It appears that feedlot operators have lowered their bids for replacement cattle due to margin uncertainty. Cow-calf producers and backgrounding operators need to pay close attention the the finishing feedlot margin structure. We’ve seen how sensitive the feeder market can be when feeding margins move into negative territory.
