The Canadian cattle industry has seen some strong prices in the first half of 2023.
Brenna Grant, the Executive Director of Canfax, says the tight supplies in North America have been the underlying factor that's really driven the market to where we're at today.
The tighter supplies in the cattle sector have also resulted in higher prices at the grocery store.
During a recession, beef tends to do fairly well as long as prices with competing proteins stay within historical ranges, if the other proteins go lower it could have an impact.
"The big question mark going forward is really on the consumer demand side of the equation. Are we going to see the erosion of demand? Are we going to see consumer switching to other proteins?"
The cattle industry is very weather dependent and the recent dry conditions over the last few years have resulted in more animals going to town.
Grant says drier conditions have resulted in higher Alberta barley prices, the key now is going to be what regions actually get the rain needed to produce feed grains this year.
" That really means that our feedlots have been pushed to explore alternative feed options to cheapen out that ration, but also look at other feedstocks that they can bring in from other regions. This creates a lot of variability in terms of cost of gain within the feedlot sector."
She says given the situation it's important that producers look at having a risk management plan in place.
"In terms of what you would do if prices dropped. That's one of knowing what your options are. Doing that research, having a marketing plan, having a risk management plan, and knowing what tools are available."
Grant points out that record-high prices does not mean record-high profitability when producers are facing higher input and feed costs.
Grant delivered the cattle marketing report during the Saskatchewan Stock Growers Association Conference and AGM earlier this month.