High Quality Hay Still Brings Top Dollar

High Quality Hay Still Brings Top Dollar November 11, 2016

Stock market gurus say to make profits you must buy low and sell high. The same market pressures influence the hay and forage market.

This year high rainfall in many areas produced high yields of both grass and alfalfa hay.  Combine that with high carryover from last year and a lot of available crop residue and you get an abundance of forage for this winter. And when winter forage is abundant, hay prices go down.

All this rain also led to some poor hay-making weather, resulting in a shortage of really high quality alfalfa.  As a result, some alfalfa growers in Nebraska are receiving over $150 per ton for superior quality dairy hay and over $100 for other good hay.

But why should you care?  You don't have any extra alfalfa.  You plan to use all your hay for your own cattle. Well, just think about this.  Suppose someone offered you $100 per ton for your better alfalfa.  Could you find other hay nearby that you could make work for your animals that would only cost $60 or $70?  If you can, maybe you can sell high, buy low, and pocket the profits.

If this sounds interesting, the next step is to find buyers. You could post notices at truck stops, place ads in newspapers and magazines, or set up a sign by your driveway.  But, there are more effective ways to contact buyers.  One is to place your hay on a computer listing in the dairy states.  Maybe an even better way is to work with dealers or become a member of a marketing group, like the Nebraska Alfalfa Marketing Association, to take advantage of all their market connections.

It may take a little extra work to be able to buy low and sell high, but smart operators look for these opportunities.

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