Hay prices in the West are stable. Markets remain sluggish, especially in areas dependent on hay exports. China, the second-largest destination for U.S. hay exports, has reduced its imports amid ongoing tariff negotiations between the two countries.
Arizona - Current conditions support moderate trade activity and steady prices across the state. Of particular note, pasture conditions in Arizona have drastically declined, with 85% of pastures now rated as poor or very poor. In comparison, only 13% of acres were in the same condition at this time last year. This significant deterioration has contributed to decreased on-farm hay stocks. May 1 stocks fell to 30,000 tons compared to 50,000 tons the previous year. Persistent dryness and worsening drought conditions are expected to continue to drive increased regional demand for hay and feed. While rainfall is anticipated in early June, an unusual event for this region, it will neither be sufficient to alleviate ongoing drought challenges nor revive non-irrigated pastures and alfalfa stands.
Arizona’s Attorney General is seeking to restrict groundwater pumping by a foreign-owned alfalfa operation, arguing that its groundwater use in the Ranegras Basin constitutes a public nuisance by depleting the aquifer, affecting local wells. This legal action has sparked concern among agricultural producers regarding the broader implications for groundwater management. Several agricultural groups oppose the lawsuit, expressing concern that it could set a precedent for stricter groundwater regulations across the state. This case is particularly significant as it marks the first time Arizona has used public nuisance law to challenge agricultural water usage. The Attorney General concedes that no existing groundwater regulations are being violated by the defendant; however, they maintain that there are clear adverse impacts from their heavy pumping, hence the public nuisance legal route.
California – Domestic hay demand in California has remained steady, while export demand continues to be light. Hay prices have been trading on the lower end of the price range, a trend partly attributed to declining hay quality. Despite this, on-farm hay stocks saw a notable increase, reaching 330,000 tons on May 1, a gain of 70,000 tons from the previous year. With reduced export activity, hay producers have noted that securing transportation has been easier, and freight rates have dropped as a result. Central Valley Project water districts serving Fresno, Tulare and Kings County have received a 5% increase to their water allocations based on current reservoir levels.
Idaho – Idaho’s hay market has been moving at a slower pace as first cutting continues. As of June 8, alfalfa cutting was 38% complete, ahead of the five-year average. Most of the crop is reported to be in good condition. However, in the Magic Valley, there has been an increase in alfalfa being chopped for haylage, driven by concerns about hay quality following rains. Over the past six months, Idaho dairies have expanded their herds by 17,000 cows, yet hay purchases by dairies remain sluggish across the state. Despite these developments, hay prices have remained steady, with supreme and premium hay trading $5 lower than the previous year.
Montana – Despite drought conditions in Montana, the hay market has been slow. Demand for hay has remained light, with most sales heading out of state since Montana cattle are already out to pasture. Pasture conditions have deteriorated significantly, with 51% rated as poor or very poor by June 8, a sharp increase from 18% in the same conditions a year ago. Meanwhile, in eastern Montana, producers have begun their first hay cuttings. Central Montana remains hopeful May rainfall could boost their first harvest, which is still a few weeks away. Though the season is gaining momentum, new crop prices have yet to be set.
Oregon – In Oregon, 80% of the first hay cutting is complete, aligning with the five-year average but slightly trailing last year’s pace. Hay demand is expected to rise among cattle producers in eastern Oregon due to extensive pasture damage caused by wildfires in 2024. This increased need may also explain why May 1 on-farm hay stocks dropped 50% from the previous year, totaling 280,000 tons.
Washington – First cutting is underway, with 73% of fields completed, ahead of the five-year average. However, new crop trading has been sluggish, with volumes well below typical levels for June. This downturn is largely due to ongoing tariff issues, which have reduced export demand, particularly from China, the second-largest buyer of hay. Compounding the issue, rain has affected the quality of the first cutting, creating additional challenges for sales. Even growers with higher-quality hay are struggling to find buyers and may opt to hold off on selling. While alfalfa export demand remains weak, timothy hay is showing stronger promise for export opportunities in the months ahead.
Profitability
June 18, 2025
Hay (Alfalfa): Breakeven profitability - Neutral 12-month outlook
Hay (Timothy): Breakeven profitability - Neutral 12-month outlook
Slow exports and sluggish domestic demand have kept alfalfa prices low, posing challenges to profitability.
Exporters' increasing interest in timothy hay could boost grower profitability.
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