Alfalfa hay demand for export outpacing dairy demand in the West

By Seth Hoyt

Seth Hoyt

Author of The Hoyt Report, providing hay market analysis and insight.

In the past few weeks, a few hay export companies in the West have been aggressively looking for and purchasing alfalfa hay. While some of this hay requires a negative GMO (genetically modified organism) test for the Chinese market, other alfalfa hay did not require a GMO test for other overseas destinations. While not all exporters are in the market, there are enough to boost export alfalfa hay prices above what dairies will pay. Demand for alfalfa hay from dairies in the West has turned quiet after falling prices on butter and cheese the past two weeks has lowered the milk price outlook for the first quarter of 2016. Consequently, many dairies have decided to not purchase hay and feed existing inventories. This past week in Blythe, Calif., recent production of Premium to Supreme alfalfa hay to dairy buyers brought $160 to $170 per ton (FOB the stack), while the same quality hay for export brought $170 to $180.