With negotiations for new-crop alfalfa getting under way, buyers and sellers are nervous about price prospects for the upcoming growing season, says Randy Hammerstrom, officer in charge for the USDA-Colorado Department of Agriculture Market News in Greeley.
“On the buyer end of things, guys are trying to protect themselves from future price increases,” he says. “Sellers who still have hay are hanging on to it, trying to squeeze out a little better price.”
Concerns about water availability underpin much of the uneasiness, he says. As of late March, the mountain snowpack in the state was just 72% of normal (based on a 30-year average). Last year at this time, the snowpack was close to 150% of normal.
“Overall, 70% is not bad,” says Hammerstrom. “Most of our reservoirs are in good shape for irrigation because of all the snow we had last year. But we are very dry in the dryland areas and we do have some fire danger.”
Colorado growers and buyers are also keeping a close watch on developments in New Mexico and Texas. “A lot of high-quality dairy hay from here and even farther north on up into Montana went to those areas last year. That put a lot of pressure on supplies and prices. They have been getting some rain down there. Maybe that will ease up things on the demand side. Time will tell.”
Hammerstrom can be contacted at 970-353-9750 or randy.hammerstrom@ams.usda.gov.