Tepid Hayt Demand Dampens Prices

Northwest FCS Vice President of Market Research and Development Michael Stolp shares details from the fourth quarter results of the Hay Market Snapshot.

Stolp: "Tepid demand has dampened Northwest hay prices. Dairies are taking advantage of lower corn prices and appear to have sufficient hay stocks for the short-term. Exporters are largely out of the market at this point due to sufficient stocks to meet weaker export demand for Northwest hay. Although hay prices have softened, prices remain at or above breakeven levels. Looking ahead, shortages of high quality alfalfa persist going into 2014 given less than ideal growing conditions across the Northwest the past three seasons. Limited supplies will likely continue to support prices at profitable levels for higher quality alfalfa."

 

The Market Snapshot shares the update on region's markets. In the Washington-Oregon Columbia Basin, rain damage was pervasive this season, and impacted all four cuttings of alfalfa for many growers. Sales of higher quality alfalfa are extremely limited due to low supplies and slow demand.

In Idaho, most growers were able to harvest three cuttings this year, and many were able to take a fourth cutting. Untimely rains caused damage throughout the season. Extreme heat and irrigation water shortages in some areas also took a toll on hay production. Similar to Washington, there is a surplus of feeder hay and a shortage of dairy quality alfalfa in the market.

In Oregon's Klamath Basin, most growers harvested three cuttings. Prices in the Klamath Basin remained mostly steady between the end of September and the end of December.