The total amount of hay stored on U.S. farms could drop to 14 million tons by next May 1, an all-time low for that date, says Matt Diersen, South Dakota State University ag economist.
“I don’t think those records were kept before 1950, and in 1950 it was 14.6 million tons,” says Diersen. “But that was a much different type of agriculture than we’ve got today.”
He expects the tight supply to keep prices high enough to bring some lost hay acreage back into production in areas outside the heart of the Corn Belt.
“The farther west you go in the Corn Belt, corn doesn’t yield as well, and you’ve also got stronger demand for livestock feed,” he says. “So you’ve got double pressure on it there and in the dairy states. I wouldn’t be surprised if Wisconsin, for example, will have some pressure to shift back.”
His 14-million-ton May 1, 2012, hay-stocks figure is a rough estimate based on 2011 production and historical data on annual disappearance, which is the amount used domestically plus exports. In its October Crop Production report, USDA estimated this year’s all-hay production at just under 132 million tons. That, added to the 22 million tons remaining on farms last May 1, brings the total supply to 154 million tons.
“At that level, historically you’d be looking at summer and fall disappearance of about 61 million tons,” says Diersen.
But the high prices are encouraging the use of substitute feeds, so he sees only 60 million tons being used by Dec. 1. Although the Southern Plains drought and dry pockets in several other states point to heavy fall hay feeding, more than the usual amounts of cornstalks and soybean stubble are being baled for feed, he points out.
If 60 million tons are used up by Dec. 1, hay stocks on that date would total 94 million tons, about 9 million tons below last December’s figure.
Disappearance from Dec. 1 to May 1 exceeds 80 million tons most years, but was slightly less than that last winter. If 80 million tons are used next winter, 14 million tons will remain on farms next spring.
May 1 stocks can’t get much lower than that, says Diersen, because livestock producers would ration dwindling supplies to make them last until the new crop is harvested in June.
“Prices will remain high to assure some stocks remain in place until the 2012 crop becomes available,” he says.