Understanding the Value of Hay

Carl C. Stafford (ccstaffo@vt.edu), Extension Agent, Animal Science, Culpeper County

Buy hay while the sun shines, an adage that may help us understand that  hay will most likely never be any cheaper than at harvest during a surplus year.  This year is stacking up as one for the hay production record books here in the Northern Piedmont of Virginia.  Buyers seem to have many choices of cow quality hay, but horse quality is in short supply, thus buying now makes sense.

2013 is an abnormal hay year, with a large hay crop but of poor quality.  Cattle producers should consider buying cow-hay at good prices to be prepared for future short years or to build a surplus supply.

There is one exception to buying hay during the growing season in the Northern Piedmont.  Some farmers make it through the winter with surplus hay in storage. To make room for a new hay, the remaining hay from the previous year needs to be removed from storage. Thus, local markets can offer cow quality round bales at competitive prices in the spring. However, you may have to bid cow-hay away from the Pennsylvania mushroom market looking for a cheap feedstock for their fungi.  So prudent hay buyers have 2 options for buying hay to meet their feeding needs without the capital investment in equipment to harvest their own hay.

The finances and costs of making hay have been in this newsletter and I will not attempt to cover the subject to the extent they did.  However, something did stick with me when reading their work, and I share these bottom line points.  One key point, fertilizer value in a ton of hay.  When fertilizer was at its peak in 2012, a ton of hay removed $90 worth of fertilizer from the land. Today it seems this cost has moderated to about $70 per ton of hay. Farmers need to know how many nutrients a ton of hay removes and the costs to replacement these nutrients. Conversely, when buying hay, the fertilizer value of the hay imported to the farms pastures.

Consider, if we remove $70 worth of fertilizer per ton of hay and there are 3 round bales in a ton, then the approximate fertilizer value per bale is $24.  Is this a high price for buyers – some will say yes.  Is this a high price for the sellers, some will say yes.  Is this a fair price for the fertilizer value in the hay?  You be judge using your own numbers, but soil nutrients will need to be  replaced to keep the land in a sustainable/productive condition.

Charging enough for hay to replace lost fertility and to cover equipment costs, labor, land, insurance, and taxes will push hay costs even higher.  $30 per bale of hay is just starting to compensate for the true cost.  A buyer will decide what they can pay and most choose to buy during a surplus time of year.  Understanding the true costs and benefits of selling and buying hay will help improve the bottom-line of the farming business.

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