DIMINISHING hay stocks and a poor season have put a floor under hay prices.
Hay and straw is trading in a similar pattern to last year but it is more expensive than in previous, better-season years.
Some dairy farmers were even stocking up on hay last month to feed out this month and next, in anticipation of lower milk prices in 2009-10.
These buyers are keen to shift the tax burden to the higher-revenue period of last financial year.
Typical ex-farm prices for fodder from northern Victoria have been cereal hay at $235 a tonne, straw $110 a tonne and vetch $300 a tonne.
Many hay and silage producers are now turning their focus to the outlook for the new season.
Producers who have been marketing hay for many years are increasingly concerned about their domestic demand and would like to see hay prices at a lower level. And a dairy-industry in decline is not in the long-term interests of any hay producer.
The outlook for new-crop fodder supply and, importantly, price is mainly determined by the area cut for hay and the yield.
Paddocks cut for hay can be those sown to a dedicated crop in autumn or opportunist crops cut in a favourable spring.
Each year, livestock producers establish their spring-fodder conservation strategy based on filling their own feed gaps in autumn and winter of the following year.
A flush of spring growth can enable these producers to be sellers of pasture hay.
For those farmers without livestock, interest in growing pasture, legume or cereal hay stems from the diversification of income fodder can often provide.
As cereal hay crops are less dependent on rains in August and September than those intended for grain, hay is an added insurance against a short season.
Hay crops, particularly cereal hay, are also a good option in case weed control is difficult in grain crops.
The added biomass of ryegrass and its potential seed bank can be harvested and work well in hay, as long as the customer is aware of the composition of the mix.
Dedicated hay producers are saying they are depending on a good spring this year.
If cereal hay crops yield as much as six or seven tonnes a hectare, the fixed costs of crop establishment can be easily met and they will be able to sell hay at lower rates than at present.
