December Hay Prices Hold Firm

US hay prices in December held firm with all-hay prices at $142 a short ton, while alfalfa hay remained at $150, according to the USDA’s National Agricultural Statistics Service.  Hay other than alfalfa increased slightly to $129 a ton from $127 in November.

NASS hay prices are collected at a much slower rate than grain prices because there is no official market.  As a result, reported prices are estimated averages, and reporting is a month behind actual transactions.  USDA average prices put all hay qualities into one number, and the final estimate is a volume-weighted average.

At $150 a short ton, the weighted average December alfalfa price was $30, or 16.7%, lower than $180 a year earlier.  Grass hay, at $129 a short ton, was $7, or 5.74%, below the year-earlier price of $122.

That makes the all-hay weighted-average price of $142 a short ton $14, or 8.97%, below the December 2014 price of $156, NASS said.

 

HAY STOCKS

 

As of Dec. 1, all hay stocks on US farms were up 3% from 2014 for a total of almost 95 million short tons, NASS said.

That was after an all-hay crop of 91.516 million short tons, which was down 3.98 million, or 4.17%, from 95.497 million in 2014.

The January crop report had all alfalfa production for 2015 at 50.034 million short tons, down 1.084 million, or 2.12%, from 2014’s 51.118 million.

The decrease in alfalfa production was the result of a 3.35% decrease in acres harvested to 17.778 million compared with 2014’s 18.395 million and a very slight decrease in national average alfalfa yield to 3.32 tons an acre from 3.34 tons a year earlier.

Other hay acres harvested, at 36.659 million, was down 2.01 million, or 5.19%, from 2014’s 38,667 million.  However, yield increased slightly to 2.06 short tons from 2.03 a year earlier.

However, NASS does not separate hay stocks on hand into alfalfa or other hay categories, so it is difficult to know how much of each type was available going into winter.

Texas had the largest all-hay supply at 8 million short tons, up 7% from 2014, and most northern and southern plains states have larger stocks compared with 2014.

The larger Dec. 1 stocks were said to be largely the result of less hay used over the summer.  The US generally had favorable pasture and range conditions, providing more forage.

Additionally, reports from western states, mainly California, say dairies are feeding less alfalfa per cow as the price of milk has gone down.

Hay price declines reflected the relative increase in production since the drought-induced tight supplies of 2011 and 2012 along with a concurrent decrease in beef cattle inventories due to drought-induced liquidation.

Alfalfa prices steadily declined since their most recent monthly high in May of 2014, to a November national average monthly price of $150 a ton.  Other hay prices also declined since their most recent high in April of 2015, to a November national average of $127 a ton.

 

CASH CATTLE QUIET

 

Cash markets Thursday remained quiet.  Bids from packer buyers were reported at $136 per cwt on a live basis early, rising to $138 late.  Asking prices were reported at $142.  Dressed-basis asking prices held at $216-$220.  Cattle traded last week about $4 higher at $138 live and $210 to $212 dressed, up $8 to $10.

Travel problems in the Plains and western Corn Belt hampered slaughter and processing so much that some of this week’s scheduled production may carry over into next week.  This could limit packers’ buying needs this week and cap prices, but sellers with cattle stressed by the same storm are having none of this argument.

The USDA reported higher wholesale beef prices Thursday, with choice up $0.46 per cwt at $223.03, and select up $0.46 at $218.48.  The choice/select spread was unchanged at $4.55, and there were 86 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Wednesday was $159.68 per cwt, down $0.46. This compares with Mar’s Thursday settlement of $156.52, down $1.42.