Nationally, hay stocks as of Dec. 1, 2018, were 13.5 percent below the five-year average, and higher-than-normal winter feeding across much of the U.S. ate into those inventories. December and January provided mild weather in the Pacific Northwest, but February conditions deteriorated, forcing livestock producers to boost supplemental feeding and dig into already low hay inventories.
In the Washington-Oregon Columbia Basin, low-quality feeder hay supplies were exhausted before February’s snowstorms, and supplies of low-quality hay in the Oregon-California Klamath Basin were used up. In response, cattle producers turned to Good to Premium alfalfa, which drew on already tight supplies of exportable alfalfa.
Idaho began winter with 440,000 tons less inventory than average, and anecdotal reports suggest lower quality hay inventory is scarce. Supplies of high-quality alfalfa remain adequate, but dairies continue to struggle through low milk prices and have little appetite for expensive hay. Montana tallied the second coldest February on record, but hay supplies were sufficient and hay prices remained stable.
Replenishing inventories with a new crop is getting off to a slow start. First cutting was delayed in the Columbia Basin, shortening the harvest window. Flooding across the Midwest will further tighten already dwindling hay stocks, and abnormally wet conditions in the East will delay spring fieldwork. High-quality Western hay will flow east to meet demand. Cattle hay will be drawn the same direction and may flow from Montana, tightening what would otherwise be average hay stocks.
Domestic demand and lower supplies impacted hay availability for exports, as did trade wars, and it’s still a wait-and-see market as trade negotiations continue. So long as tariffs between the U.S. and China remain in place, Spain will enjoy increasing market share. Elimination of tariffs would put Northwest producers back on even footing with alfalfa produced in Africa and Europe. Saudi Arabia provides a bright spot for the U.S. export market, but much of that hay comes from the Pacific Southwest.
Read “Hay Market Insights: 2019 acreage questions remain.”
Weather-related production challenges are having varied impacts in Australia, a potential competitor for the Chinese market. Similar to the U.S., domestic demand is limiting supplies available for export. Lower exports from Australia favor Northwest timothy export demand and pricing for the 2019 crop.
Related to trade, while Mexico and Canada aren’t U.S. export markets for hay, ratification of the U.S.-Mexico-Canada trade agreement (USMCA) will have an impact on hay markets by improving the economic state of U.S. dairy farmers. 
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Dave Natzke
- Editor
- Progressive Forage
- Email Dave Natzke
