Hay Prices Surpisingly Stay At High Levels | Hay & Forage Grower

Hay Prices Surpisingly Stay At High Levels

Hay-acreage decrease, inflation may be causes, economist says
Jul 15, 2014 Jeff Holmquist

Hay prices have remained strong during the first part of 2014 despite decent carryover stocks and adequate production, according to Matt Diersen, ag economist with South Dakota State University.

“I’m surprised hay prices are as high as they are,” he says.

One reason for the price stability is the slight decrease in U.S. hay acres planted in 2014. USDA’s June Acreage report estimated that 57.6 million hay acres will be harvested this year, down from 58.3 million harvested acres last year.

“Fewer acres to be harvested across the country means what’s out there you have to fight over,” Diersen says.

The other contributing factor is the inflation seen across the entire ag sector.

“The price level for all farm goods is higher than it was a year ago, even taking lower corn prices into account. That’s probably given hay a 5-10% price boost.”

As a result, prices remain similar to last year’s levels, even though declining prices might be expected as the new crop rolls in, he says.

Hay producers across the country will continue to see prices influenced by California dairies and exporters having to find hay in other states due to the continuing drought in the Southwest and West. A favorable early hay crop in the Pacific Northwest could help deal with supply needs further south, he says.

“How that’s going to play out, I’m not sure,” Diersen says. “Eventually, they may need to draw hay from this part of the country (the Midwest). But I think there’s going to be a bit more production in this part of the country to meet those needs.”

Growers across the U.S. are experiencing a mixed bag when it comes to the hay supply and quality. Here are what two growers and another economist say is happening in their areas so far this year.

Persistent rains have lowered hay quality in Illinois and the Upper Midwest, says Don Brown, Jr., a hay producer and dealer in Davis, IL.

“We just had our county fair and everybody was asking what the haymaking situation was,” he says. “I told them it’s like religion … you get to make hay one day a week. It’s pretty depressing.”

He’s not alone in his misery, Brown adds. “I’ve talked to people in South Dakota, Kansas and Wisconsin. We’re all battling the same thing.”

But Brown was fortunate to have quality carryover stock from last winter, when he had back surgery and stopped marketing crop. Now that he’s back on his feet and three weeks of continuous rain had damaged the current crop, calls are pouring in.

“People are looking for good, dry hay,” he says. “I sold a lot of last year’s inventory during the month of June. I still have a little bit left.”

Prices held at last year’s levels, Brown reports, with good-quality dairy hay at $250/ton and beef-cattle feed at $100/ton. He sells alfalfa, alfalfa-grass and straight-grass hay in 3 x 3 x 8’ bales to dairies, beef operations and horse owners across Illinois, Wisconsin and Iowa.

His 200 acres of new-crop hay, says the former president of the Illinois Forage and Grassland Council, has been a challenge. “I have 40 acres of hay on the ground all the time, so I ruined a lot,” he admits.

“But we started cutting second-crop alfalfa July 8, and it looks good. I just hope the weather holds.”

The early hay season has been poor in many parts of Oklahoma, says Brandon Drinnon, a hay grower in Taloga.

“It started off so dry, and we all started holding our heads down,” he says. “We just thought we were in for another dry year all the way around.”

Some dryland growers didn’t take a first cut, while irrigated farms fared a bit better, he reports.

“We’ve missed at least one cut, and some people have lost two. A lot of times we get two-thirds of our crop on first cutting, but we obviously didn’t get that this year.”

Some timely rain in June, however, improved prospects for a decent year.

“We are all glad to get what we’re getting,” he says. “We do remember last year when we didn’t get anything.”

Growers don’t have much supply on hand, so prices remain strong in the Central Plains, Drinnon says. Dry-cow hay fetches $140/ton while good-quality dairy hay remains at $240/ton. The prices are very similar to last year’s at this time.

“We’re not going to have an abundance of hay for a long time,” the grower concludes. “But we will have some hay to move this year.”

He puts up alfalfa hay in 3 x 4 x 8’ and 4 x 4 x 8’ bales on 200 dryland acres and sells to dairies in New Mexico and Texas. Drinnon also buys hay for resale from growers in Oklahoma, Kansas and Nebraska.

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Overall, hay supply and quality in the Southeast and along the East Coast have been good this year, according to Curtis Lacy, ag economist with the University of Georgia.

Recent dry weather helped growers at first cutting, Lacy reports, but now much of the Southeast could use a shot of rain again.

“We did have a lot of rain early in the year, so we had a lot of growth. But it has been dry here the last several weeks,” he says. “If we actually get some rain in the next few days or weeks, we’ll be in pretty good shape. People will be well on their way to second cutting.”

Hay prices are stable in Georgia and the surrounding region, Lacy says, and he doesn’t expect them to shift much in coming months.

Reach Dierson at 605-688-4864 or matthew.diersen@sdstate.edu[2], Brown at 815-238-8372 or don.brownjr@yahoo.com[3], Drinnon at 580-334-8960 or drinnonhay@hotmail.com[4], or Lacy at 229-386-3512 or clacy@uga.edu[5].

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Alfalfa Acres Up 2.4%; All-Hay Down | Hay & Forage Grower

Alfalfa Acres Up 2.4%; All-Hay Down

Timely spring rains, in areas, help boost production
Jul 8, 2014

U.S. hay growers will likely harvest more alfalfa and alfalfa-mix dry hay acres in 2014 – an increase of 2.4% totaling 18.2 million acres. That compares to 17.8 million alfalfa acres produced in 2013, according to USDA’s June 30 Acreage report[1].

But a 3% decrease in other hay acres, totaling 39.5 million acres, is expected to be harvested this year compared to that produced in 2013. On average, all-hay acreage will decrease by 1%, from 58.25 million acres last year to 57.65 million in 2014.

The expected increase in alfalfa acres can be attributed to timely spring precipitation throughout the Upper Midwest and Northern Plains, according to the USDA report. The biggest acreage gains are likely in New Mexico, by 52% to 220,000 acres; Oklahoma, by 35% to 310,000 acres; Wyoming, by 20% to 540,000 acres; and by 15% in Colorado and in Washington, to 750,000 and 470,000 acres, respectively.

North Dakota alfalfa acreage will decline about 5% to 1.54 million acres, down from 1.62 million acres in 2013.

Virginia growers will only harvest 75,000 acres of alfalfa and alfalfa mixtures, a 17% decline from 90,000 acres harvested last year. Oregon, Illinois, Indiana, Kentucky, Missouri, New Hampshire, New Jersey and New York will see alfalfa acreage declines as well.

All-hay record high acreages are predicted in Oklahoma and Florida, according to the report. All-hay record lows are predicted for Nebraska, Maryland, Vermont and Rhode Island.

Rains Keep Washington Hay Growers From Fields | Alfalfa content from Hay & Forage Grower

Rains Keep Washington Hay Growers From Fields

The second cutting of alfalfa is under way in much of Washington, but recent rain has caused some decline in quality, says Chep Gauntt, a Pasco, WA, grower.

“It did damage equivalent to a lot of heavy dews. But there’s not been a lot put up yet,” says Gauntt, who, with his son, Drex, harvests 1,300 acres of alfalfa and timothy. About 90-95% of their center-pivot-irrigated crop is exported.

As second cutting progresses, the price for “really nice, double-compressed bales … might be $240-250/ton,” he estimates.

Alfalfa and timothy prices in the Columbia Basin have been steady, with good demand and light to moderate supplies available, according to the July 3 USDA Market News report.

Alfalfa large-square bale prices were, for supreme quality, $260-270/ton; for premium, $260/ton; good quality, $240-245/ton; and fair quality, $220/ton.

Large squares of timothy grass were priced at $270-280/ton for premium quality and $260-270/ton for good quality. Small squares of premium timothy traded at $280/ton. Small squares of premium orchardgrass sold for $260-275/ton.

To contact the Gauntts, email gaunttfarm or call 509-521-4245.

Global Hay Demand, Competition Grow Strong

Global Hay Demand, Competition Grow Strong

How much hay will be exported to calcium- and protein-hungry regions like China and the Middle East may depend in part on competition from California dairies. So says Greg DeWitt, marketing manager for ACX Pacific Northwest, Inc., a California-based hay exporter.

ACX currently buys hay from seven key Western states – Washington, Oregon, California, Arizona, Nevada, Utah and Idaho. But demand for high-quality hay among domestic customers is on the rise, partly because of continued drought in the West that has cut into hay stocks and pushed prices upward.

“It’s all going to come down to the domestic markets and the availability of hay,” he says of his company’s ability to sell more hay overseas in 2014.

Even so, only 3-4% of all U.S. hay production is exported, he adds. “A significant portion of the alfalfa we supply overseas is summer hay that traditionally has not had the strongest demand domestically.

USDA’s May ag export projection, totaling $149.5 billion, is an increase of $6.9 billion from its February prediction. Hidden in the numbers is the rising demand for alfalfa hay, which alone accounted for about $586 million in exports last year.

“Export forage dynamics have changed a lot in a relatively short period of time,” says John Szczepanski, director of the U.S. Forage Export Council, a committee of the National Hay Association.

“Just a few years ago, Japan and Korea accounted for the lion’s share of U.S. forage exports. Since 2007, those traditional markets have remained pretty much the same, with all the new growth coming from China and the Middle East.” (See graphic.)

China, with an estimated 15 million dairy cows to feed, is now the No. 1 foreign buyer of U.S. alfalfa, due in part to its growing appetite for dairy products and animal protein. More than 800,000 tons of alfalfa hay were shipped from the U.S. to China in 2013, compared to none in 2006 and 460,244 tons in 2012, according to USDA’s Foreign Agricultural Service (FAS).

Just three years ago, Chinese hay purchases were about 2% of ACX’s total revenue, adds DeWitt. Last year, China accounted for 21% of the company’s hay sales.

Although 94% of the hay that China imports comes from the U.S., according to FAS, other countries are also starting to compete for the business. China recently signed significant agreements to import forage from Canada and Spain.

“The U.S. isn’t the only show in town,” Szczepanski warns. “Exporters need to continue to focus on safety and quality.”

But rising demand for hay is more than just a Chinese phenomenon. The United Arab Emirates, South Korea, Taiwan, Malaysia and Indonesia all have increased their hay imports over the past year as well.

ACX is based in Bakersfield, CA, with storage and hay-processing facilities in Stockton and WIlmington, CA; Ellensburg, WA; and Goldsboro, NC.

Contact DeWitt at gregdewitt and Szczepanski at john.

The Best Grasses To Match With Alfalfa | Alfalfa content from Hay & Forage Grower

An alfalfa-grass mix makes for a digestible dairy ration that can reduce the potential for laminitis. But not all alfalfa-grass pairings are created equal.

Some grasses mature faster or slower than alfalfa, making harvest more challenging. Some yield significantly more or offer higher potential milk production than others. Seeding rates vary by species. And, of course, grasses produce differently depending on the region. Those are just a few factors producers should consider when deciding which grass to seed with alfalfa.

“What is most important about the grass is tons per acre, as well as the digestibility of the fiber relative to when you can harvest it,” says Charlie Sniffen, a dairy nutritionist with Fencrest LLC, Holderness, NH.

When matching grasses with alfalfa, Sniffen looks for new species that have about 14% protein and 50% neutral detergent fiber (NDF). If the NDF gets much higher, digestibility falls off. The highly digestible fiber from grass can also tone down high-energy diets that cause laminitis, Sniffen says.

Determining the right alfalfa-grass ratio in a stand is important, too. For dairy-quality hay at optimal yield, stands should contain no more than 25% grass, recommends Jim Paulson, University of Minnesota (U of M) Extension educator.

Source: University of Minnesota

Meadow fescue and tall fescue are Paulson’s top choices as alfalfa companion crops because of their yield, quality and survivability. The two had some of the highest yields of any grass mixed with alfalfa at trials he ran in 2011 and outperformed pure alfalfa stands. The alfalfa-meadow fescue combination averaged 5.43 tons/acre of dry matter at two sites, and alfalfa-tall fescue averaged 5.76 tons/acre. The alfalfa-only stand averaged 5.4 tons/acre at the two sites.

The two grasses also were of high quality, with alfalfa-meadow fescue averaging 14,090 lbs milk/acre and alfalfa-tall fescue averaging 14,920 lbs milk/acre. The alfalfa-only stand averaged 13,490 lbs milk/acre.

Tall fescue also matures in a similar time frame as alfalfa, adds Keith Johnson, Purdue University forage specialist. Johnson is high on improved varieties of the grass from a grazing perspective because of its firm surface for animal traffic and stockpiling ability. “It’s a species I’d have on my short list.”

Be sure to choose a novel-endophyte or endophyte-free tall fescue that’s been adapted to increase NDF digestibility, Paulson says.

Orchardgrass is the other species Johnson and Paulson recommend. The grass was the top yield and quality performer in Paulson’s alfalfa-grass trials, averaging, with alfalfa, 5.85 tons/acre of dry matter and 16,400 lbs milk/acre.

But orchardgrass only works well in dairy rations as a late-maturing variety. The grass has a range of maturity dates, and early maturing varieties can be stemmy at first cutting when included with alfalfa, Johnson says.

Timothy produces fairly good yields and quality, but peaks at first cutting and slows down during a hot summer. With alfalfa, it averaged 4.75 tons/acre of dry matter and 12,285 lbs milk/acre in U of M trials.

The perennial can mature too late to match with alfalfa, developing seed heads a week or more after the legume begins to flower.

“As a beef hay or horse hay, it probably works. But for overall productivity I’d probably stay away from timothy (when combined with alfalfa),” Paulson says.

Smooth bromegrass poses problems mixed with alfalfa because it should not be harvested on alfalfa’s four-week schedule. It needs to be cut every six weeks to persist.

Like timothy, smooth brome produces well at first cutting, but peters out during summer, Paulson says. The alfalfa-brome mix averaged 5.15 tons/acre of dry matter in his trials, but produced only 13,005 lbs milk/acre.

Meadow brome seems to perform best in cooler climates, Paulson says. He lost a lot of plants at his southern Minnesota trial location, but not at plots farther north. Johnson has been impressed with the anecdotal results he’s seen from meadow brome in Indiana, but wants to see more research before forming a concrete opinion of it.

The alfalfa-grass mix averaged 5.4 tons/acre of dry matter in Paulson’s research, the same as the alfalfa-only stand. Its average quality was in line with alfalfa’s, too, at 13,430 lbs milk/acre.

Festulolium and perennial ryegrass are better-suited for Southern climates, because they don’t survive winter as well as other grasses. They also lack the yields of other grasses. Alfalfa seedings with perennial ryegrass averaged about 0.5 ton/acre less than ones with orchardgrass and tall fescue in Paulson’s trials – 5.3 tons/acre. An alfalfa-festulolium mix yielded even less at 5.14 tons/acre.

Reed canarygrass is slow to develop and was well behind the fescues and orchardgrass in terms of yield and quality in Paulson’s trials. The cool-season grass, with alfalfa, averaged 5.31 tons/acre in yield, and 13,725 lbs milk/acre.

In Indiana, reed canarygrass is considered an invasive species by many because “seed can find its way to tributaries and streams, and then you have a species that can be in spots where you don’t want it to be,” Johnson adds.

It does have its attributes. Reed canary grows well in different soil types, so it may be productive in a wet region or in a low-pH field, Sniffen says.