CONTINUED weak demand is pushing down cereal hay values.
Put simply, supply is weighing on demand. Hay merchants report that few hay trucks are active and prices for cereal hay were about $5 a tonne easier last week.
Cereal hay delivered into the key dairy regions around Kyabram and Shepparton is now quoted about $135 a tonne.
While some parcels of higher quality cereal hay that have been stored well are achieving better rates, buyers have been able to secure loads at these levels.
The fall in cereal hay prices has made growers appreciate the value of continuing export markets for their hay.
Many export hay producers were able to secure prices that are between $30 and $50 higher than current rates.
In a similar pattern, lucerne prices have also eased recently. Hay producers in South Australia are experiencing the lowest domestic demand for years. Lucerne sourced from the South East of South Australia is now quoted at $210-$215 a tonne delivered to dairies around Mt Gambier.
Lucerne hay delivered into dairy farms in northern Victoria also eased $5 last week.
Unlike previous years, this autumn has been favourable for pasture production. Rain and some irrigation have enabled establishment of annual pastures particularly in northern Victoria and in Gippsland.
Some of the earlier sown pastures are being grazed for the first time.
New stands sown in Gippsland are now looking for rain to continue their good start. However, the rainfall outlook appears dry for Gippsland for the next week.
Dryland paddocks in northern Victoria are also carrying stands of emerging grass. Most of these paddocks have a high proportion of barley grass. While the new growth will be valuable for sheep and cattle, the feed quality is not expected to remain on going.
In the competitive hay marketing calendar, we are now approaching the home straight. If producers have not sold their hay by this stage, they will depend on winter demand to clear their sheds.
The weather is coming in cold now. In previous seasons, livestock producers have been plagued by the same cold weather but without the buffer of grass in the paddock and ample stores of hay and silage that exist at present.
Even though the affordability of purchased supplementary hay is improving, beef and dairy farmers will consume their own stocks first before buying.
