Long-distance transportation costs can affect hay’s marketability – something North Dakota hay grower John Flemmer experienced last winter. Flemmer; his brother, LeRoy; and his son, Evan, grow alfalfa-grass hay on 1,500 acres near Golden Valley. Traditionally, the Flemmers have marketed large round hay bales to local ranches.
Around the first of the year, Flemmer heard about hay shortages in the Texas Panhandle and western Kansas and placed a hay-for-sale ad in an Amarillo newspaper. His asking price: $40/ton at the farm gate. “We got a lot of calls right away. But we couldn’t get anything done. The freight costs were prohibitive.”
This spring, a trucker making backhauls of oil rig equipment out of Kansas to North Dakota’s oilfields moved most of Flemmer’s old-crop inventory to a western Kansas dairy and beef feedlot. When new crop came on in early July, the grower moved more hay to western Kansas, even though the at-the-farm price for his better-quality hay had nearly doubled.
“That backhaul really makes a difference,” he says, noting that the freight bill for 28-30 round bales moving 800 miles is around $1,800. “If nothing else, it allows the trucker to at least cover his fuel costs for the round trip.”
Assessing how buyers will react to freight charges is always a challenge for hay sellers, says Paul McGill, owner of Rock Valley Hay Auction, Rock Valley, IA. As of mid-July, McGill reports, $3.25-3.75/loaded mile, depending on fuel costs, was a fairly standard charge for trucking hay long distances out of his region.
“We were getting quite a few inquiries from people in the drought areas about hay availability,” says McGill. “But at that rate, we were right on the edge of where it was economically feasible to move hay to those areas. A backhaul can cut a trucker’s costs by as much as half. But depending on the buyer’s circumstances, it can still be pretty pricey to move hay any kind of distance.”
What remains to be seen is how freight costs will affect sales to hay-deficit areas as supplies tighten further this fall and winter.
“I’m sure there are going to be a lot more calls as time goes by,” says McGill. “My experience has been that freight costs take on less and less importance as people get more desperate for hay.”