It often seems that hay markets and prices are strictly local but, supplies and weather around the country can have far reaching effects. Understanding inventory in the hay market can be as easy as tagging a new calf with an unhappy mama. However, there is some data that can help, at least, provide an understanding of regional and national hay production. Depending on the forage base (cool season perennial, warm season perennial, or warm/cool season annual plantings), rain and fertility can be the primary contributors to yield expectations. Not to discount the impacts of natural disasters and insects. Understanding the total inventory on hand entering the production season, consumption of hay stocks, and impact of exporting hay stocks can help in forming some price expectations and suggest some earlier or later purchases.
Expanding and contracting drought conditions plagued the southern region during production periods for warm season perennials and annuals. Hay production regions in the south experienced some relief from hurricanes and tropical storms. Depending on production schedules Figs. 1-3 illustrates the impact of drought conditions on summer forages.
Figure 1.
Figure 2.
Figure 3.
May 1 U.S hay stocks and disappearance steadily decreased starting in 2020 (Fig 4). However, coming out of winter in 2024 hay stocks rebounded to 2020 stocks level. Hay disappearance is largely driven by hay feeding, winter’s length and severity, and the size of the cow herd. Disappearance started decreasing in 2020 signaling reduced total hay needs. In 2024, use of hay returned to 2020 use levels.
Figure 4.
It often surprises people to learn that the U.S. exports a significant amount of hay, largely alfalfa and other high value specialty hays. The US hay export market moving three-year average valuation is $1.51 billion. As of 2023, the export market was valued at $1.34 billion. Total hay exports have trended downward since 2022, mainly driven by weak demand from China. The top four countries that import U.S hay stocks are China, Japan, Saudi Arabia, and South Korea.
So, are we just to expect the market to behave like 2020 due to stock levels? A notable difference in the southern region will be the potential production impacts from summer droughts. Hay prices are beginning to decline in parts of Texas due to abundant production from this year’s rains. Hay markets do represent climate dynamics with a few large weather market issues thrown in. The storm forecasted for later this week could bring rains for grass growth in drought affected regions of the South. But it’s very late in the growing season for much hay production. USDA will report a hay inventory estimate in December which will provide a good stock on hand estimate, so we will wait on that early Christmas present.
Fischer, Matthew. “Inventories, Weather, and Local Hay Markets.” Southern Ag Today 4(37.2). September 10, 2024. Permalink
