It looks like the supply of dairy-quality alfalfa hay will remain tight as a drum through next winter, despite USDA's prediction that hay acreage will increase this year. Grass hay for beef cows and horses, however, may become plentiful.
USDA surprised almost everyone when, in its March 30 Prospective Plantings report, it forecast that growers will harvest 63.1 million acres of hay in 2007, 4% more than in 2006. Harvested acreage is expected to increase or hold steady in 34 of the 48 contiguous states, and drop in just 14.
“It kind of shocked me, to be honest,” says Joe Waldo, alfalfa marketing manager for NK Brand Seeds.
Like most observers, Waldo had expected the report to show a drop in hay acreage as farmers respond to high corn prices by plowing up older alfalfa fields and planting fewer new ones. Based on seed sales, Waldo still believes alfalfa acreage will be down.
The court order that prohibited the planting of Roundup Ready alfalfa after March 30 probably resulted in an additional acreage loss, says Waldo. Many growers who planted Roundup Ready alfalfa last year and were intending to plant it again this spring switched to corn instead of going back to conventional alfalfa.
“A great example is southwestern Kansas, which is one of our biggest areas of Roundup Ready,” says Waldo. “Over 50% of the growers who were going to plant Roundup Ready alfalfa this spring decided to go to corn when they couldn't get Roundup Ready alfalfa seed. That is going to put more pressure on the availability of dairy-quality hay this fall.”
So where will all the hay acres come from? A look at USDA's state-by-state numbers reveals that some of the biggest expected increases are in Great Plains states, which have an abundance of grass pastures. At least 100,000 more hay acres are projected for every state in that region.
For Kansas, the increase is put at 350,000 acres, or 11%, and Steve Hessman, Kansas Department of Agriculture-USDA Market News reporter in Dodge City, believes most of it will be grass.
“We have a strong demand for grass hay, plus we've got good moisture conditions this spring and they're going to be able to hay some meadows that haven't been productive the last couple of years,” says Hessman.
“I don't think we'll have more alfalfa,” he adds. He talked to one or two growers who were planning to plant alfalfa, “but more is coming out than is going in.”
The situation is similar in Nebraska, where USDA predicts a 200,000-acre jump in harvested hay.
“I think most of the increase, and in fact I bet all of the increase, is coming from grass hay,” says Bruce Anderson, University of Nebraska extension forage specialist. “People are going to cut more of their grazing land areas rather than graze them in order to build up their hay supply. But I really think that, when we get down to it, we're going to have a fairly sizable reduction in alfalfa acres.”
Not all of the projected hay acreage gains are explained as easily as in Plains states. Increases are also projected for the Corn Belt states of Indiana and Missouri, for example. Indiana farmers planned to plant 700,000 fewer soybean acres, making room for that many more acres of corn. But harvested hay is also expected to be up 50,000 acres over last year's figure.
“To be honest, I don't know where they're finding all the acreage,” says Dave Petritz, Purdue University ag economist, referring to Indiana as well as the national projections. “I'm hard-pressed to explain it.”
Waldo, Hessman and Anderson also wonder if there are enough crop acres available for everything farmers say they'll grow in 2007. The Prospective Plantings report, which covers 21 major crops, shows that 6.1 million more acres will be harvested this year than last.
“With the high prices, farmers are going to maximize everything they can this year,” reasons Greg Thessen, head of the field crops section of USDA's National Ag Statistics Service Crops Branch.
Thessen says some of the acreage gain can be explained by farmers' plans to double-crop more acres, especially soybeans following wheat in the Delta and Southeast. Increased “double counting” may also be a factor, he adds. For example, if a small grain is harvested for hay, it gets counted for both crops, once as acreage planted to the small grain and again as acreage harvested for hay.
“I don't know how much more of that will go on this year because of the short hay supply,” says Thessen. “But it's one possible source of double counting.”
Also, acreage of some minor crops is expected to be reduced, making more room for the 21 major ones. Pulse crops and flax, for example, are down a total of about 550,000 acres, says Thessen.
“When you take all that into consideration, is it really 6.1 million more acres or is it somewhere in the 4-million range?” he asks. “And is it possible that there's enough land that was summer fallowed last year that will be planted this year, along with the expected increase in hay harvested acres, to account for the additional crop acreage? I guess we think there is.”