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Don't Overlook Details When Setting Hay
Prices
Hay producers need to make sure they cover their costs
of production when setting hay prices, says Don Ball, Auburn University
extension agronomist. Negotiating a fair hay price is important to both
hay buyers and sellers, but the ball is in the seller's court because
the seller sets the price at which the hay will be offered.
All that seems a bit basic. But Ball says it's not unusual for a hay
producer to overlook costs associated with producing hay, which can
include harvesting, advertising, storage and transport costs. It's easy
to underestimate storage expenses, too. Storage building depreciation
can be figured at about 5% of building costs per year, Ball notes.
Consider costs of equipment repairs, taxes and insurance. And nutritive
analysis of the hay, appearance, and the cost of alternate feeds also
influence hay pricing. Yet, Ball notes, the current market is the final
determinant of what a buyer will pay.
Ball says buyer and seller also need to ask the following questions. How
is the hay packaged? How, and for how long, has it been stored? How
will it be transported, who will transport it, and who will pay for it?
Will there be difficulty in finding and accessing the place to which the
hay is to be delivered? Will the buyer have refusal options? Who will
unload the hay? What is to be the method and time of payment?
Communication is the key to avoiding problems, Ball notes. Long-term
success in the hay business depends on reputation and trust.
Source: Don Ball, Auburn University. Contact Ball at 334-844-5491.
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U.S. Sheep Industry Continues To Expand
Hay growers with sheep-producer customers should be
happy to know that both sheep and lamb inventory numbers -- as well as
the total number of operations with sheep -- have increased, according
to recent USDA-ARS reports.
The Jan. 1 U.S. sheep and goat report showed a total lamb inventory of
6.23 million head. This is a 2% increase from both 2005 and 2004. The
inventory has shown two consecutive year-to-year increases for the first
time since 1987 and 1988. Breeding sheep inventory also increased 2%,
from 4.53 million head to 4.64 million head. The 3.66 million head of
ewes, age one year old or older, rose 2% above last year's number.
The number of operations with sheep totaled 68,280 during 2005, up 1%
from both 2004 and 2003. According to the National Agricultural
Statistics Service, operations with 500 head of sheep or more account
for 47.3% of the total U.S. sheep inventory. Operations with one to 99
head of sheep account for 28.7% of the total inventory, while operations
with 100-499 head of sheep account for 24% of the inventory.
Source: USDA and American Sheep Industry Association.
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Just How Much Hay Do All Those Sheep
Eat?
Ewes can eat around 770 lbs of hay per year, depending
upon production stage, according to Purdue University. The amount of hay
a ewe needs is determined by the average weight of the ewes in the flock
and the length of time they need to be fed hay. The 770-lb figure is
based on a production situation with ewes weighing 175 lbs and needing
to be fed hay for six months.
The Purdue example estimates 3.75 lbs of hay are fed per day for 80 days
during early gestation, which adds up to around 300 lbs. Ewes in late
gestation would receive around 4.25 lbs/day for 40 days, while lactating
ewes would eat 5 lbs of hay for 60 days. Purdue animal scientists point
out that needs would change for this example depending on ewe weight,
length of the feeding period, and when ewes are lambed.
Source: Purdue University.
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Nifty Hay Niches
For more information on niche hay markets, see the
articles Nifty Niches and Alpaca Opportunities in the February issue of
Hay & Forage Grower, pages 4-6.
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Fed Hay Helps Fertilize Pastures
Hay producers are providing beef customers with more
than just feed value -- beef producers often overlook the fertilizer
value of the hay being fed. So says John Lory, University of Missouri
environmental nutrient management specialist.
A ton of fescue hay contains about 40 lbs of nitrogen (N), 15 lbs of
phosphorus (P) and 40 lbs of potash (K), he says. Many of these
nutrients pass through the cattle -- non-lactating cows return the
equivalent of almost all fed nutrients back to the pasture. Some of the
N is lost, so ultimately about 25% of the fed N and all the fed P and K
have fertilizer value. The nutrients in a ton of hay are enough to match
the P and K nutrient removal rates for one acre of pasture. The
fertilizer value of nutrients in a ton of hay adds up to about $15,
according to Lory, assuming 40¢ for N, 30¢ for P, and 20¢
for K.
This type of fertilizer only has value if the cow does a good job of
distributing its manure around a field. Although cattle tend to deposit
most of their manure near feeders and water sources in a pasture, Lory
suggests some ways of spreading it. Frequently move feeders and feeding
areas around a pasture and increase stocking density of animals. But
move them more frequently to prevent over-use of parts of the pasture.
Do not use the same pastures for supplemental feeding each year; moving
winter feeding areas each year distributes nutrient benefits around the
farm.
Producers should also protect water quality by maintaining setbacks
between winter feeding areas and streams and lakes. Frozen and saturated
soil promotes the movement of manure nutrients in runoff.
Source: University of Missouri. Contact John Lory at 573-884-7815.
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Upper Midwest
Upper Midwestern hay prices ending the week of Feb. 3
were generally steady. That's according to the weekly hay market demand
and price report for the Upper Midwest, compiled from public and private
sales by the University of Wisconsin.
With light-to-moderate trade activity and demand, Nebraska and Iowa hay
prices were steady. South Dakota hay prices were mixed and somewhat
lower. Missouri hay prices were steady and higher than they were the
previous week, with moderate demand and sales activity. Some rain fell
in areas of Missouri, where trees and bushes were showing signs of
budding. That has many growers concerned that grass may leave dormancy
and get hit with a hard frost. Some buyers were finding difficulty
locating what they needed. Prices seemed to be a hindrance, because
Missouri hay buyers have resisted increases. This led several truckers
to take hay to states where they could see some profit. Southwestern
Minnesota hay prices were lower than they were the previous week, but
sales activity was good. Wisconsin prices at the Lomira hay auction
were 32% higher than hay prices in the rest of the Midwest but 10% lower
than at the Jan. 6 auction. That's because a snowstorm lowered sales
activity and buyer demand.
Illinois hay demand was good, with moderate-to-active sales activity.
Hay prices remained steady to higher than they were the previous week.
The supply of Illinois hay was light-to-moderate. Many hay loads
imported from neighboring states helped the supply. Hay offerings
increased slightly at the beginning of the month at Illinois auctions
and have managed to keep up with demand. The demand for all types of hay
has been good, but in the last several weeks it increased for beef-type
hay, bringing a slight increase in some big round bale prices. Demand
from the livestock sector has been good, even though snow and cold
temperatures have not been a factor.
Midwestern straw prices averaged $2.28/small square bale, $30.88/large
square bale, and $23.86/large round bale. Compared to prices the
previous week, small square straw bale prices were down 4%. Large
square bale prices were up 99% (due to Illinois prices). Large round
bale prices were up 6%.
Around the Midwest, small square bales of prime hay (testing greater
than 151 RFV) averaged $114.88/ton. Large square bales of prime hay
generally went for $109.48/ton. Large round bales of prime hay averaged
$82.50.
Grade 1 hay (125-150 RFV/RFQ) averaged $78.06/ton. Large square Grade 1
hay brought around $77.30/ton, and large round bales averaged
$59.11/ton.
Small square bales of Grade 2 hay (103-124 RFV/RFQ) averaged $86.67/ton.
Large square bales of the same grade brought a medium price of
$84.67/ton. Large round bales went for, generally, $50.94/ton.
Source: Ken Barnett, University of Wisconsin. Contact Barnett at ken.barnett@ces.uwex.edu.
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Texas
High hay costs and extended supplemental livestock
feeding have pushed Texas drought losses to an estimated $1.5 billion,
according to the Texas Cooperative Extension Service. More than 90% of
the state's range and pasture land is said to be in extremely stressed
condition. Hay supplies are short and expensive. Ranchers are re-culling
cattle and selling heifer calves, which should cut the state's cow
numbers. Most of the calves have been shipped directly to feedlots due
to lack of wheat fields to graze.
Much of the state's hay production was cut in half due to lack of
rainfall, driving up hay prices. Planting prospects are said to be
looking grim for spring crops, particularly in southern Texas. Most
ryegrass and small grain pastures didn't come up, or haven't had enough
growth to graze in eastern Texas. Wheat stands have failed or are
marginal, bringing significant damage to the overall state wheat crop.
Eastern Texas has been one of the hardest-hit regions. Typically, about
750,000-1 million acres of winter pasture in ryegrass or ryegrass
blended with oats are planted to offset supplemental feeding bills. Low
rainfall kept those plantings from surfacing, according to Texas A&M
reports.
Texas Farm Bureau, Texas and Southwestern Cattle Raisers Association and
Texas Cattle Feeders Association officials wrote to the White House,
Secretary of Agriculture and members of the Texas Congressional
delegation. They made an uncharacteristic plea for government
assistance, including funding assistance through the Livestock
Compensation Program/Livestock Assistance Program and other government
programs.
Source: Texas A&M University.
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Calendar
**Feb. 7-8 -- Nebraska Alfalfa Marketing
Association's Mid-America Alfalfa Expo, Kearney. Contact Barb Kinnan
at 800-743-1649 or visit www.nebraska-alfalfa.com.
**Feb. 7-9 -- Producing Cash Hay for Virginia's Equine Industry
Workshops, Feb. 7-Armory in Chatham; Feb. 8-Southern Piedmont
Research Station, Blackstone; Feb. 9-Tidewater Research Station,
Suffolk. Registration for each will begin at 8 a.m. and the programs
will end at 3:30 p.m. Early registration deadline is Jan. 27. Contact
Chris Teutsch at cteutsch@vt.edu,
or call 434-292-5331, ext. 234.
**Feb. 14-16 -- World Ag Expo, Tulare, CA. Learn more at www.worldagexpo.com.
**Feb. 16 -- Indiana Forage Council Annual Meeting and Seminar
Presentation, Cornerstone Hall, Salem. Contact Lisa Metts at lmetts1@purdue.edu or 765-494-4783.
**Feb. 21- 22 -- Central Plains Irrigation Conference, Comfort
Inn, Colby, KS. Learn more at www.oznet.ksu.edu/sdi/REvents/cpia.html.
**Feb. 22-23 -- Pennsylvania Hay and Silage Conference, Holiday
Inn, Grantville. Contact Lisa Crytser at 814-865-2543.
**Feb. 23 -- Kentucky Alfalfa Conference, Lexington. Contact
Garry Lacefield at 270-365-7541, ext. 202.
**Feb. 25 -- Bi-State Forage Institute: Focus on Hay, The
Stratford Inn, Harvard, IL. Call 847-223-8627.
**Feb. 27-28 -- Idaho Hay and Forage Association Meeting, Red
Lion Canyon Springs Hotel, Twin Falls. Learn more at www.idahohay.com/.
**March 4 -- Grass-Finished Meats Seminar, Bloomsburg
Fairgrounds, Bloomsburg, PA. Contact Kris Ribble at 570-784-4401, ext.
111, or Dave Hartman at 570-784-6660, ext. 12. Sponsored by Penn State
Cooperative Extension and Project Grass Northeast.
**March 10-14 -- 2006 American Forage and Grassland Council
Conference, Westin Riverwalk Hotel, San Antonio, TX. Learn more at
www.afgc.org, or call
Dana Tucker at 800-944-2342.
**March 14-15 -- Midwest Hay Business Conference and Expo,
Ramkota Hotel, Sioux Falls, SD. Sponsored by Hay & Forage Grower.
Visit www.hayconference.com.
**March 22-23 -- Manitoba Forage Symposium, MacDon Product
Showcase Building, Winnipeg, Manitoba. Call the Manitoba Forage Council
at 204-322-5427, or visit www.mbforagecouncil.mb.ca/Default.htm.
**April 21-23 -- Midwest Horse Fair, Alliant Energy Center,
Madison, WI. Learn more at www.midwesthorsefair.com.
**April 28-30 -- Minnesota Horse Expo, Minnesota State
Fairgrounds, St. Paul. Learn more at www.mnhorseexp.org.
**May 25 -- University of Florida Corn Silage And Forage Field
Day, Plant Science Unit, Citra, FL. Contact Jerry Wasdin at
352-392-1120 or jwasdin@animal.ufl.edu, or
visit www.animal.ufl.edu. Under "Dairy Cattle," click on
"Corn Silage Field Day."
**Sept. 7-9 -- National Hay Association 111th Annual Convention,
Snow King Resort, Jackson Hole, WY.
**Oct. 3-7 -- World Dairy Expo, Alliant Energy Center, Madison,
WI. Learn more at www.worlddairyexpo.com.
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Send Questions & Comments
To...
Lora Berg,
Editor, eHay Weekly,
hfg@prismb2b.com
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