A good way to keep tabs on what customers and potential customers are thinking about hay industry trends and developments? Utilize social media outlets like Facebook or Twitter – or write your own blog.
Frank Maricle, a Tumalo, OR, hay grower and blogger, learned that first hand recently when he devoted a post on his business blog – Central Oregon Hay – to explain why horse hay prices in his area have risen sharply in recent months. As a result of his readers' comments, he's changing his marketing strategy.
"I use the local Craigslist to market orchardgrass and timothy hay, mostly to horse owners," says Maricle, who farms in partnership with his dad, Scott. "I noticed that there were quite a few people on there complaining about high hay prices in our area and that there were a lot of accusations about price gouging. I thought doing a post on the topic would be a good way to get some information out there and educate people on the economics of the hay business."
With the headline "Hay Costs Breakdown," Maricle pointed out that higher prices for commodities – particularly wheat and corn – had led area farmers to pull roughly 2,500 acres of hay out of production this year. Regional carryover stocks coming out of the winter were fairly light, he added. Those factors put more pressure on the local hay supply, pushing prices upward.
Local hay growers are coming off several consecutive years of historically low hay prices, Maricle also noted. "When prices drop, many farmers barely get by. So when prices finally do climb, they climb pretty high. But (they) usually drop back down after more acres are planted. Simple supply and demand principles."
As part of the post, he offered a detailed accounting of input costs and explained how those costs come into play when hay growers set a price. "I understand that it is hard to swallow coughing up $200/ton for hay to feed horses. But the prices are set for a reason. Yes, farmers will make money this year, but remember that we are farming for a profit. We have huge amounts of capital tied up in our crop, and we deserve to make a return on our investment."
Maricle attempted to explain why central Oregon hay prices were higher than prices in the western part of the state, too. "Hay grown in the valley (west of the Cascade Mountains) has the advantage of being irrigated primarily by rain, which saves farmers a lot of money and that is reflected in the lower prices. However, valley hay is usually lower quality, both in palatability and nutrition content."
The posting brought "quite a few comments" from his readers – most disagreed with him. A reader representative of those who commented appreciated his effort but wrote that Maricle still didn't explain why central Oregon hay is more expensive and twice the price of hay sold elsewhere in the state.
While he posted many of the comments he received, Maricle opted to leave some out. "They were just too negative and contentious and didn't fit in with what I want the blog to be. It is a place for education and information, not a sounding board for people looking to vent." To read posted comments, click here.
Writing the blog and mulling over the replies he received led Maricle to reshape his marketing strategy for this year. "Heading into the summer, we were planning to sell right out of the field at a price of about $200/ton," he says. "But as the comments I got showed, the overall economy is still in pretty tough shape, and we're getting some price resistance.
"We think we'll probably do better by putting our hay in the stack and selling it this fall. We'll have to tack on an additional charge for our handling and storing, but the hay should move better as supply tightens up more heading into the winter."
To contact Maricle, call 541-280-1054 or email mariclelandlivestock@gmail.com.