SA hay producers will have to wait and see how the fire that gutted Balco’s hay processing facility at Bowmans on Saturday will affect purchases for the 2017 season.
Balco chief executive officer Rob Lawson said 2016 season hay contracts would not be affected.
“With hay contracted for this year, there’ll be no problems,” he said.
“We’ll be working with the growers and taking the hay contracted.”
But there might be implications for the new season, according to Mr Lawson.
“It’s something we’ll be working through in the next couple of weeks, once we establish how quickly we can get going again,” he said.
“But we will definitely be buying hay in the 2017 season in SA.”
Mr Lawson said Balco still had some of this season’s hay stored in farmers’ sheds, so the company would be looking at opportunities for moving and storing hay in other locations.
It has been a tumultuous 12 months for the state’s fodder industry.
At the same time last year, Balco was on the hunt for extra supplies.
Outstanding prices were on offer – even rain damaged hay made $160 a tonne – with the average price for undamaged oaten hay between $200/t and $250/t.
The strong returns were on the back of good demand from traditional markets such as Japan, Korea and Taiwan and great growth in demand from China.
But the demand from China has not been as strong as expected in the past few months, and there is plenty of hay supply, particularly lower grades, due to the season’s wet weather.
On a national level, there are strong supplies of hay across the nation, and declining domestic demand due to challenging dairy conditions and plenty of paddock feed.
