RECORD HAY SUPPLIES SMOTHER PRICES FOR ALL BUT HIGH-QUALITY DAIRY HAY

Writer: Marlene Fritz (208/364-4010 in Boise)
Source: Neil Rimbey (208/459-6365 in Caldwell)

IDAHO FALLS, Idaho–A record 1999 hay crop, heaped on top of generous carryover stocks from 1998, has pushed Idaho’s October hay supply to an all-time high of 6.254 million tons.

Neil Rimbey, University of Idaho extension range economist, projects that strong demand for high-quality dairy and horse hay will maintain prices for those products at $85 to $110 per ton. Lower-quality feeder and beef hay markets will continue with depressed prices in the $35 to $55 per ton range.

"Growers appear to be getting a bit more sophisticated in some of their cultural practices, and many are shooting for the dairy market," says Rimbey in the UI’s Fall 1999 Idaho Agricultural Outlook. "But after the dairy market, things look pretty bleak."

He notes that a long, hard winter, which would drive up feed consumption, could "dramatically" improve price forecasts.

Demand for high-quality hay continues to be fueled by an expanding dairy industry. Idaho dairy cow numbers, increasing at about 2,500 head monthly, are likely to settle at around 330,000 by Jan. 1. That’s up from 302,000 a year ago.

By contrast, Rimbey says beef numbers are static at a little below 500,000 cows and heifers, and stock sheep numbers are likely to continue declining to about 200,000 head.

According to the USDA’s National Agricultural Statistics Service, Idaho growers this year produced a projected 4.945 million tons of alfalfa on 1.15 million acres. In addition, they raised 532,000 tons of other hay, pushing total crop production to 5.477 million tons. Total Idaho hay acreage held steady at 1.43 million, but growers swapped 20,000 fewer acres of other hays for 20,000 more acres of alfalfa.

According to Rimbey, first-cutting hay was compromised by rain in several areas of the state this spring, and much of the 777,000-ton carryover crop from 1998 is also of lower quality.

The beef industry’s minimal price increases and escalating costs should keep the federal grazing fee at or near the formula floor of $1.35 per animal unit month, or AUM, in the year 2000. State land grazing leases have been set at $4.75 an AUM. Rimbey estimates that the bulk of private grazing leases will fall in the $10 to $15 range, depending on distance and level of services provided.

The Fall 1999 Idaho Agricultural Outlook is available at length, with supporting tables and graphs, on the web site of the UI Department of Agricultural Economics and Rural Sociology, http://www.uidaho.edu/ag/agecon. Once on the home page, Internet users should click first on Publications, then on the Idaho Agricultural Outlook for October 1999.