Focus Remains On Hay, Forage Supplies

Hay production and forage supply quantities have improved slightly from mid-summer but cattle producers are still watching closely as the growing season ends, according to a report by an economic consulting firm.

Steiner Consulting Group said drought conditions in the Northern Plains in late May worsened into the early summer. That forced abnormally high numbers of cattle to be moved out of that region to feedlots or areas with better forage. Dry weather also became a bigger issue for the Pacific Northwest and Inter-mountain West as the summer progressed, leading to major wild fire challenges.




Hay production will be close to 132 million tons in 2017, down 3 million tons from last year, USDA-NASS (National Agricultural Statistics Service) estimated. Range and pasture conditions have traced a typical seasonal pattern, dropping from the spring to the fall as summer heat and dryness take a toll.

Range and pastures rated in good to excellent conditions at mid-year in 2016 was at 59%, declining to 46% by mid-October. This year, mid-year range and pasture conditions were 57% good to excellent, with a decline to 40% in the most recent week. Better range and pasture condition in the Southeast and Southern Plains this year have been a counterbalance to problems in the West and Northern Plains.

Steiner’s survey said total hay supplies for the 2017/ 2018 crop year (May 2017–April 2018) are down almost 2% from the prior year, given the smaller hay production this year. This matches up with a 2% increase in roughage consuming animals in the U.S. compared to 2016, due mostly an expanding beef cattle herd. Hay prices had been tracking above year earlier values since the Spring, based on the combination of less hay supply versus more animals.

Grass hay values were surprisingly weak in August, mostly due to a 25% price decline in Oklahoma, the third largest non-alfalfa hay producing state. Grass hay prices were down 5% in Texas, the largest producer of non-alfalfa hay. California, Minnesota, and Ohio also recorded double-digit percentage declines in non-alfalfa hay prices from July to August.

Carryover hay supplies from last year in Oklahoma were at the highest levels since 2008 at the end of April. They were triple the inventory on hand in April 2012 when Oklahoma experienced its last drought. These large supplies, coupled with favorable weather in August for pastures in Oklahoma, put pressure on hay prices. That happened even though current year grass hay production is about the same as last year. Alfalfa hay production in Oklahoma is up more than 40% from 2016.




Cattle producers in the Southern Plains are experiencing a much improved situation compared to a year ago. Calf prices this August are up 8% from the prior August while grass hay prices (non alfalfa type) were 12% lower than a year earlier. The ratio of Oklahoma City steer calf prices (500 to 550 pounds) to grass hay prices this August was 2.61:1, compared to 2.12:1 in August 2016 and 3.69:1 in August 2015. The current forage situation is encouraging for the beef cattle industry in the Southern Plains.

Drought conditions in parts of the Midwest may have producers scrambling to find forage for their herds and could result in many looking to alternative feed strategies.

Denise Schwab, Iowa State University Extension beef specialist, said producers worried about the quality of forage should have it tested, If grass is short, she said a producer might want to wean calves early to reduce the stress on the cow and pasture. Producers could make use of available corn stalks, and pregnancy checking and culling open cows could also help stretch feed supplies, Schwab said.




Boxed beef cutout values were firm on moderate demand and light offerings. Choice was up 29 cents at $199.86 while select was up 38 cents at $191.14. The spread was at $8.72 and 101 loads of fabricated product was sent to market. Negotiated cash trade and demand were light to moderate on Friday. Live purchases ranged from $110.00 to $111.50. Dressed prices mostly traded steady at $175.00.The CME Feeder Cattle Index for the seven days ending October 19 was $154.79, down 29 cents.