Hay turns to gold

A two-year drought and this year’s harsh winter weather are contributing to a national hay shortage that’s hurting many Missouri farmers. Back-to-back years of low hay production are forcing them to decide between selling their livestock or paying two to three times more than last year for hay.

“We are completely out of hay,” Boone County hay supplier Ken Rall said. “Normally we have hay left until March or April.”

The hay shortage has spread across the Midwest and southern Plains states such as Texas and Oklahoma. Tony Hancock, market news reporter for the Missouri Department of Agriculture, said farmers are hard-pressed to find any hay in Missouri. Most are looking to Northern states such as Iowa and Wisconsin that have seen more rainfall.

“There are 20 states going to these places competing for hay,” Hancock said. “The demand is outlandish.”

Going north for hay forces farmers to dig deeper into their wallets, especially those in the southern regions. Jeff O’Laughlin, owner of Missouri Hay and Straw in Ashland, said high fuel prices have forced the price of small square bales up $2 to $3. He’s charging $5 to $9 for a small square bale now.

“People balk at that price, but that’s the price of doing business,” O’Laughlin said.

Hancock said larger round bales that cost an average of $40 last year are now selling for $70 to $90.

Hay prices were reasonable before the shortage became critical, O’Laughlin said. “The Missouri farmer had undervalued their product,” he said.

Hay is a supplemental feed that is given to livestock during the winter and other times when grass is not available. Corn is provided when there is a lack of hay, although corn is the more expensive choice.

The weather factors of a prolonged summer drought and ice and snow this winter have combined with high corn prices and a longer hay-feeding season to compound the shortage. Hancock said Missouri and the southwest and west-central regions of the country are having the hardest time, because intense summer drought forced them to start feeding hay to livestock as early as July last year.

“Traditionally, feeding hay before Thanksgiving is too soon,” Hancock said.

Rall said that, like other hay producers, he ran out of the forage early this year and has had none since Thanksgiving.

“I get five or six e-mails a week from people all over looking for hay,” he said. “We don’t have any.”

O’Laughlin said he still has hay left. He primarily sells to owners of animals such as horses, cattle, goats, llamas and rabbits.

Kelly Smith, marketing and commodities director for the Missouri Farm Bureau, said the harsh winter has hit ranchers hard.

“The ground has been covered at least part of the time because of the two big snowstorms, causing farmers to feed more hay to their livestock,” he said.

Smith said summer droughts have prohibited farmers from carrying over their usual surplus of hay from year to year.

“We went into this winter with no surplus hay,” Smith said. “Farmers were relying on what they grew this past summer.”

In the past, farmers have looked to corn and corn by-products to supplement animal diets. But ethanol production has caused corn prices to skyrocket, leaving farmers with few options.

“Farmers still have to look for hay,” Hancock said. “Sometimes it’s still cheaper than corn.”

Yet another reason for the hay shortage is a higher number of cattle. Smith said Missouri cattle producers expanded their herds during high cattle prices the past few years. The more cattle there are, the more hay they eat.

With less hay and high corn prices, however, some cattle producers have reached their limit and cannot afford to feed their herds. Hancock cited an increase in cattle sold last fall. Some farmers, especially in southwest Missouri, have sold their entire herds, causing a significant drop in cattle prices.

“There is just more supply (of cattle sold) than demand to keep up with,” Hancock said. Feedlots, too, are paying less for calves because they can’t afford the corn it requires to feed them out and produce good beef.

Meanwhile, the dairy industry is also feeling the pinch. Dairy producers feed higher-value alfalfa, known as dairy-type hay, to maintain high milk production in lactating cows. Because beef cows do not lactate in the same capacity as dairy cows, beef farmers feed a lower-value grass hay, or beef-type hay, often supplemented with grain. The quality of the dairy-type hay makes it more expensive to begin with.

Foremost Dairy Research Center, an MU dairy farm west of Columbia on Old Highway 40, contracts large square bales to the farm by the ton, mostly out of Iowa and Kansas. John Denbigh, manager of the dairy center, said the farm normally pays $125 to $130 per ton of dairy-type hay, and that price has increased to $196 per ton. Beef-type hay typically priced between $105 to $115 per ton is now $166 per ton.

“Prices go up every year, but this is the most I’ve ever had to pay for hay,” Denbigh said.

Ralph Buckner of Bolivar hauls hay full-time throughout Missouri, mainly to dairy farmers.

He said he is having a hard time finding any dairy-type hay at all. A former dairy farmer himself, Buckner normally gets his hay in western Kansas because he likes the dry, leafy quality of the hay there.

“I’ve milked for 30 years,” he said. “I get something I’d like for myself.”

Buckner said hay supplies in Kansas this year were down to half the normal amount available, as farmers in Oklahoma and Texas took a majority of it early on.

“If I can’t get all the hay I want here,” Buckner said, “I have to get it anywhere I can.”

Green pastures this spring may provide short-term relief in hay prices. But individual farmers who choose to hold their hay rather than sell it, and other hay producers who turn to growing a more reliable crop such as corn and soybeans, will exacerbate the hay shortage in the future. O’Laughlin said it’s important that ranchers evaluate their hay needs early.

“They should start doing that now,” he said. “They should think about what they’re going to do later this year.”

O’Laughlin also said the rising cost of land is making producing crops like hay more difficult.

“As a farmer, you want to be able to produce your product and make money off of that,” he said. “With what land you have, you have to be able to maximize.”

Hay farmers will need to take measures to maximize their crop next year. Gene Schmitz, livestock specialist for University Extension in Warsaw, said farmers need to access their hay fields when the ice melts to better predict this year’s hay crop. The quality will be based on additional moisture on the ground in late winter and this spring.

“Hay fields and pastures are drought-stressed,” Schmitz said. “Plants are not as healthy, which gives us a poorer forage base.”

Schmitz said applying extra nitrogen to the soil may help farmers stimulate more hay production this year.

O’Laughlin said he will continue to produce his products for years to come despite the shortage.

“My business is centered around hay and straw. My family and I made a commitment to do it,” he said.

The Missouri Department of Agriculture is trying to help the situation by running the “hay hot line,” which connects hay producers with those in need of the product. The number is 800-877-4HAY, or 800-877-4429.

In addition, the MDA and MU provide an online source of available hay listings, which can be found at agebb.missouri.edu/haylst/index.htm.