THE longer hay prices remain low, and the more dairy farmers become confident in the future directions of milk prices, the more hay demand inches up each week.

While prices remain unchanged, there are reports of increased interest for better-quality hay.

Some dairy farmers have been avoiding spending money on hay by feeding cheaper and lower-quality lines.

These farmers have noticed a drop in their milk production and have now switched to better hay.

By paying as much as $40-50 a tonne more for their hay, they are finding favourable results in the vat after each milking.

Hay marketing can be easy, as long as hay sellers demonstrate the value of quality to hay buyers.

This topic and others will be discussed in detail at tomorrow's Dairy, Fodder and Grain Farmer's Update at Moama's Rich River Golf Club.

Hosted by the Victorian Department of Primary Industries, Murray Dairy, the Victorian Irrigated Cropping Council and Australian Fodder Industry Association, the update provides all farmers the chance to assess how they grow and market grain and hay and to consider how feed quality affects profits.

One emerging aspect in Victoria's northern irrigation areas is the move by adaptive dairy farmers into cropping.

As some dairy farmers leave the industry, more land is coming on the market in the Goulburn and Murray valleys.

With some supplementary irrigation, these dairy farmers are intending to expand their skill set by growing cereal crops for either grain or fodder.

This could alter the shape of hay demand in the future.

One group of hay sellers has been more active than most recently.

Hay-baling contractors often are paid a portion of their contracting job with a share of the hay they make for their clients.

Compared to the hay growers, contractors have different marketing objectives with hay.

Due to the scale of their operations and lack of other revenue streams, the contractors face larger diesel bills and cash flow is more pressing.

Hay contractors have been active sellers eager to gain revenue for completed contracting jobs.

In contrast, many hay producers take a longer-term view of the hay market and are prepared to wait until stronger demand lifts prices in winter.

The Moama seminar runs from 10am to 4.45pm tomorrow.

For more information, visit the Australian Fodder Industry Association website.