Wednesday, May 17, 2017

Severe winter strengthens East Idaho hay prices

Eastern Idaho forage growers report hay prices are in the profitable range, following a severe winter that reduced the glut.

IDAHO FALLS, Idaho — Eastern Idaho hay farmers say they may again have a chance to raise a profitable crop.

A glut of hay depressed the forage market during the past couple of years, though slumping prices of competing crops left growers without better options.

However, growers and feeders say the extreme winter has depleted hay inventories, resulting in strengthening alfalfa prices.

“It looks like the old crop hay is pretty well cleaned up,” said Lewisville feedlot operator Duwayne Skaar. “We’re thinking this (new crop of feeder) hay will start out over $100 per ton.”

Bone-area rancher Rick Passey ran out of hay several weeks ago and has been buying additional bales from a neighbor. Passey plans to make his first cutting of new alfalfa June 15-20.

“We started out at $80 per ton, and we told them we needed 100 tons more, and they raised it to $100,” Passey said. “The carryover that’s been here for the past couple of years, I think it’s going to be greatly dwindled.”

As of May 1, USDA reported Idaho on-farm hay stocks at 510,000 tons — down 46 percent from the previous year. But good rangeland conditions should provide some relief to ranchers. According to a USDA report for the week ending May 14, 83 percent of the state’s pastures and range were reported to be in good to excellent condition.

Passey said unseasonably warm weather during the first two weeks of May melted snow and stimulated grass growth throughout the foothills where his cattle graze, though he’s had to repair miles of fencing damaged by heavy snowdrifts.

University of Idaho Extension economist Ben Eborn recently calculated the cost of producing a ton of alfalfa in Eastern Idaho at $87. Earlier this winter, he said feeder hay was selling for $60 to $75 per ton.

“That price is probably up $25 per ton,” Eborn said, adding the new alfalfa crop sustained less winter damage than many feared, and hay export demand is also improving. “We got the hard winter, and it cleaned the hay out, dropping the oversupply in half.”

With grain prices still low, Dubois alfalfa grower Chad Larsen anticipates feeders will feed less hay and more corn and barley. Larsen said feeder hay is selling for about $110 per ton delivered, and dairy hay is selling for about $150.

“We get calls every week on feeder hay or dairy hay, and we’re out,” Larsen said.

McCammon rancher Jim Guthrie said many feeders have resorted to buying poor-quality hay, some of which has been sitting for two years.

“I’ve never seen semis going up and down the road with junk hay on them like I have this year,” Guthrie said.

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