THERE has been more turmoil for dairy farmers as the fall in milk prices widens.

While the changes are not supportive to hay prices, supply and demand will ultimately determine the market price.

The response from dairy farmers has been mixed.

Some will be reducing feed costs by culling less productive cows. Others are considering cheaper, lower-quality roughage under $200 a tonne delivered.

In most cases, these costs can be achieved only at the expense of milk production.

Farmers have learnt the value of quality hay and how litres in the vat can tell the story of feeding cows correctly.

For less than $200/tonne, canola hay is still available and some bargains do exist if the test is right. Mixer wagons can assist in reducing the feed out losses.

This season, straw may come into contention if combined with higher energy feed grains.

Straw supplies are low this year as composters have ample carryover stocks and the lack of orders has discouraged contractors from making speculative stocks of straw.

Straw can be purchased at about $100/tonne on-farm plus freight and GST. At about $160/tonne delivered to northern Victorian farms, straw could be an option for some to reduce input costs for feeding.

In areas where there is limited access to grazing or cheaper supplementary feeds, dairy farmers may consider cow parking.

Milking herds can be transported to other dairy farms where they are fed and milked and returned to the original farm when the feeding economics improve.

This may alter the distribution of hay demand but may not reduce demand overall.

Some hay buyers are optimistically wishing for a realignment of hay prices with those for milk.

Lower prices for hay could improve dairy farmer profitability. In some cases buyers and sellers have lose supply arrangements in place with no set price or tonnage.

Dairy farmers can argue that their viability for future years can depend on hay sellers lowering the price for hay this season.

The counter argument to this is that supply and demand will ultimately determine what prices is achievable in the market.

If hay demand falls, sellers will compete in a smaller market and prices will fall.

If supply is restricted and buyers wish to maintain their use, they will compete for product, supplies will be rationed and prices will be supported.