Despite a major production falloff due to drought, 2012 was a good year overall for Nebraska grower Steve Rice.

“Demand was up and prices were high,” says Rice, who partners with his brother, Scott, at SR Farms near Wilsonville. “The good hay isn’t hard to sell.”

The Rice brothers grow alfalfa on 900 irrigated and 300 dryland acres. They also put up another 500 acres on shares. Dairies east of the Colorado Rockies are their target market.

Compared to the average, yields last year were down by 25% on their irrigated ground and 50% on dryland fields. “On most of the dryland, we only cut twice,” says Rice. “The hot, dry weather was especially hard on the new seedings.”

Even so, the Rices still have around 200 tons of alfalfa in inventory. “We try to sell hay year-round. We want to make sure we always have some inventory on hand so we can take care of our regular customers.”

Large square bales of dairy-quality alfalfa are bringing $250-300/ton at the farm in the area. Grinding hay packaged in round bales is fetching $200-250/ton. “It’s not junk hay, by any means. There wasn’t much rained-on hay put up at all this year.”

He believes prices could stay in that range for the next several months. “Nobody knows what’s going to happen in the dairy industry. But if dairy producers don’t get some help on milk prices, I don’t see how hay prices can go much higher.”

Soil moisture levels remain a concern in many parts of the state. SR Farms accumulated 1.5” of moisture during the last three weeks of December. “That was the first significant moisture we’ve had in six months,” says Rice. “We’ll have to get a lot more moisture than we’ve had so far or subsoil moisture going into next season will be very short.”

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