If you're tempted to grow organic hay to latch onto its price premiums, push a pencil carefully, advises Lou Anderson.
“It's not a good fit for every grower,” says Anderson, a Fairfield, ID, organic hay buyer who also serves as president of the Idaho Organic Feed Growers Association. “There are a lot of unique challenges to producing this kind of product. You need to assess whether you're in a position to overcome those challenges and then determine whether it's economically feasible.”
For Monte Vista, CO, grower John Haws, devoting 120 acres of irrigated ground to organic alfalfa production five years ago was a solid decision. He markets his organic hay through a local broker selling to Texas dairies producing organic milk.
Haws says organic hay comparable to high-quality conventional alfalfa in relative feed value (RFV) and protein has been selling for about $25/ton over conventional alfalfa prices. With an average yield of about 5 tons/acre, the grower figures the premium yields more than $12,000 of additional income on the 120 acres.
“That's a pretty good deal any way you look at it,” says Haws. “Organic alfalfa is working for me.”
Even so, Haws acknowledges that making organic hay work comes with a steep learning curve. He stumbled early on when he planted fungicide-treated seed on roughly a third of the ground earmarked for organic hay. That set him back three years in getting that part of his acreage into organic production. Under USDA rules, fields must be chemical-free for at least three years to qualify for organic certification.
Maintaining soil fertility without chemical fertilizers can also be challenging. Phosphorus is his major concern.
“Under the regulations, we are allowed to plow down a rock phosphate,” Haws says. “Finding a source can be difficult and it's a little more expensive than a commercial fertilizer.”
Staying on top of the extensive record-keeping chores that go along with organic production is another challenge, according to Haws. Keeping his state organic certification requires an annual inspection. Cost, prorated according to acreage, is $1,200 per year.
He points to rules requiring that the baler be cleaned thoroughly before each use as one example of just how detailed the process can be.
“We have a neighbor do our baling and a lot depends on where the baler has been before it gets here,” he says. “It can take up to three hours to do the cleaning. We have to blow out the baler chamber – if it's really dirty, we have to get in there with the power washer. With the windrower, it's not so bad; we just sweep it off.”
His location offers an advantage when it comes to insect control.
“We can get temperatures of -30 or -40,” he says. “So it's cold enough here that a lot of bugs just freeze out in winter. There's always a chance of cut-worms in spring. But if that happens, we write off the first cutting and go from there.”
Controlling gophers is another matter.
“We're not allowed to use poisons, so the only alternative is to trap them,” Haws explains. “Now, instead of taking care of the problem in a day, we might spend a whole month on it.”
Controlling gophers was one difficulty that led Dinsdale Farms, Silver Lake, OR, to decide to take out its 400 acres of irrigated organic alfalfa this year.
“The problem has gotten worse over the years,” says Scott Duffner, farm manager. Dinsdale Farms marketed its organic hay directly to an organic dairy. “We had people trapping, but with 400 acres to cover, they just couldn't keep up with the gopher population.”
Weed control issues also were a factor in the decision. “Early in the life of the stand, the alfalfa competed fairly well with the weeds,” Duffner says. “But as we went along, we had more and more grasses coming in without a good way to control them.”
Production dropped off sharply as the stand aged. When it was new, yields topped 5 tons/acre on three annual cuttings. Last year, the yield was 3-4 tons/acre.
“When you figure in the lack of production and the cost of inputs like organic fertilizer, the premium we were getting for organic alfalfa just didn't pencil out,” says Duffner. “We saw this as a good time to get out of it.”
Anderson believes there's still plenty of room for growth in the organic hay market. He notes that his firm, S&L Commodities, was selling just 7,000 tons of organic hay per year 15 years ago. Last year, sales topped 50,000 tons, most of it purchased by organic dairies in Western states.
“Organic milk production continues to grow,” says Anderson. “And organic feed production has been able to keep pace with that growth. We saw more demand for organic hay last year than we've ever seen in the past.”
And, he says, the growth is likely to continue. “It might slow down some, but it's not going to come to a complete stop.”
Even so, Anderson advises growers not to be misled by reports of organic hay bringing 40-50% premiums over traditional alfalfa prices.
“It all comes down to quality,” he says. “On the high end (180 RFV or more), prices for organic and conventional hay usually aren't far apart. When you get into the middle quality range, the spread can be a little more. From what we've seen over the years, the premium is typically in the 10-15% range. But it has been as high as 25-30% at times.”