Forage Fodder

Western hay markets are finding support from tighter supplies, even as export demand remains subdued. Drought conditions across portions of the West have limited forage availability, while higher diesel, feed commodity, and transportation costs are raising the expense of producing and moving hay.

A strong U.S. dollar and weaker Asian currencies continue to erode the competitiveness of U.S. hay in global markets. From January through August, U.S. all-hay exports totaled 1.7 million metric tons, below the same period in 2025. West Coast shipments fell sharply in June and recovered modestly in July, but remained below the five-year average. Overall, U.S. hay exports have declined for a fourth consecutive year.

Overall, the long-term contraction in Western alfalfa acreage should provide a price floor in hay markets. However, the outlook is increasingly regional, and supply- and quality-dependent. High-testing dairy hay should retain a premium where supplies are limited, while lower-quality hay may continue to benefit from demand for more economical rations. Export-oriented markets face greater risk unless overseas buying improves.

Conditions by state:

Arizona

Hay demand remains mixed. Dairy and export demand has been inconsistent as higher freight costs, weather concerns, and softer dairy economics have reduced buying interest. Recent rainfall and insect pressure affected hay quality in some areas, leading to wider price spreads between premium and lower-quality lots. Export interest for alfalfa and bermuda hay persists, but buyers remain price sensitive. Water availability and future Colorado River allocations continue to create uncertainty for forage production, helping support some forward purchasing activity. Retail alfalfa prices are among the strongest in the West as horse and hobby-farm demand stays active.

California

Hay markets remain generally stable. Dairy buyers continue to purchase cautiously as lower milk prices and elevated diesel costs pressure margins, resulting in more hand-to-mouth buying. Late-season alfalfa yields have been lighter than expected across portions of the Central Valley, helping support prices despite slower movement. Fair-quality alfalfa continues to move well due to affordability. Retail demand remains strong, and concerns about future water restrictions continue to encourage some buyers to secure hay supplies early.

Idaho

Markets have softened modestly as dairy demand slows. Many buyers built their hay inventories earlier in the season. For those still in need of feed, corn silage harvest and weaker Class III milk prices have reduced immediate purchasing interest. Despite softer demand, growers have generally resisted lower offers. Fair-quality hay continues to see the strongest movement, while higher-testing alfalfa faces more resistance from dairy buyers. Export demand remains present but slower than earlier in the year.

Montana

Markets remain relatively firm with moderate to good demand. Recent rainfall improved grazing conditions in some areas, reducing immediate feeding needs and tempering demand. However, many producers remain concerned about entering winter with limited forage supplies and could begin supplemental feeding earlier than normal if conditions deteriorate. Hay continues to move into drought-affected neighboring states where prices remain more attractive. Supplies are generally adequate, although straw inventories are tight.

Oregon

Hay markets continue to perform well, while dairy-quality alfalfa prices have remained mostly steady. Recent rains affected portions of southern and central Oregon creating issues with third cutting hay, leading to some quality discounts but supporting local demand for lower-grade hay.

Washington

Hay markets have been stable. Local demand from dairies, feedlots, and ranchers continues to provide a solid base of support. Premium export-quality alfalfa remains in demand, though the market is narrow and highly selective. Demand for timothy hay has been slower, particularly second-cutting supplies which had quality issues limiting buyer interest. Export demand has softened compared to historical levels, and fewer hay exporters continue to operate than in prior years. Nevertheless, strong local demand and limited supplies of top-quality forage have helped maintain generally firm prices.

Profitability

Hay (alfalfa): Slightly profitable - Bullish 12-month outlook
Hay (timothy): Slightly profitable - Bullish 12-month outlook

Alfalfa profitability has improved as drought, reduced pasture availability, and stronger feed demand have lifted prices, and is expected to continue improving over the next 12 months.

Timothy hay remains slightly profitable, although current export demand is weak. The outlook is cautiously bullish based on expectations for improving forage markets and eventual stabilization in export demand. However, uncertainty surrounding export buyers remains a significant risk.