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Low milk prices depress Idaho hay market

Last winter’s extreme weather pulled down Idaho’s hay stocks for livestock feed, but not enough to boost prices given less demand from dairies.
Carol Ryan Dumas

Capital Press

Published on December 13, 2017 8:36AM

Last changed on December 13, 2017 9:18AM

Carol Ryan Dumas/Capital Press File
Alfalfa is swathed in this field near Jerome Idaho, last summer. Low milk prices continue to depress Idaho hay prices.

Carol Ryan Dumas/Capital Press File Alfalfa is swathed in this field near Jerome Idaho, last summer. Low milk prices continue to depress Idaho hay prices.

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BURLEY, Idaho — Ample hay supplies, plentiful alternative feeds and sour milk prices are teaming up to create a bleak outlook for Idaho hay prices.

Premium alfalfa hay in Idaho sold for $125 a ton last week, compared to $187 in the Columbia Basin and $210 in northern California, according to USDA Market News Service.

Idaho has carried over a lot of hay in recent years, and there’s a lot stacked up in southern Idaho, Steve Hines, University of Idaho Extension educator for Jerome County, told growers at the university’s annual Idaho Ag Outlook.

Last winter’s extreme weather had growers thinking a lot of the excess hay would be fed to livestock “and the sun is going to shine again,” he said.

But that didn’t happen. A lot got fed, but there’s still a lot of hay, he said.

Stocks of all hay in Idaho on May 1 were 510,000 tons, down significantly from a year earlier, but they had been much higher. May 1 stocks were 950,000 tons in 2016 and 900,000 tons in 2015, compared to 320,000 tons in 2014.

“I don’t see pricing going up ’til some of these stocks go out,” Hines said.

Despite declining prices the last couple of years, there was only a slight decline in Idaho’s alfalfa acres in 2017, and production of alfalfa hay was up 9 percent year over year.

Production-wise “2017 was a pretty good year for alfalfa growers. There were a few less seeded acres, but in a lot of situations more was produced on those acres,” he said.

Idaho is a livestock state, and that’s good for hay growers, but they aren’t the ones who set the price, he said.

“Dairies get to set the price on hay,” he said.

The hay market isn’t going to come back until the dairy market comes back, he said.

“We’ve still got a lot of hay in the stack, and pricing is going to stay low as long as milk is low,” he said.

Dairymen can and do substitute straw, corn, barley, corn silage, hay from other states and pasture for Idaho alfalfa. Corn silage acres in Idaho have increased greatly over the last 25 years, about 440 percent, he said.

Substitute feed stocks are showing high carryover and lower prices for 2018. The total supply of U.S. corn, for example, is near a record high at close to 17 billion bushels, with an average price of about $3.25 a bushel in September.

The average low U.S. price for alfalfa hay for the 2011-2015 crops was $180 a ton. The average low for the 2016 crop was $129. So far, the average price for the 2017 crop is in the $140-$150 range.

That’s a long way from $180, and the market is not going to get back there until the dairy market improves, he said.

“We’ve still got a lot of hay in the stack, and pricing is going to stay low as long as milk is low,” he said.



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