Hay production drops drastically

JT Johnson & Sons International marketing manager Corey Ryan said hay exporters had been pleased pleased with the quality and volume of hay available, despite some exporters having asked their suppliers to plant less due to a large carry-over.

"Johnson's asked our suppliers to plant regular hectares of oats this year, which naturally was slightly down on last year," he said. "Most areas of SA have produced very high quality hay.

"There are some exceptions where hay crops struggled with a lack of moisture in the growing season and other areas that received rain damage late in the season, but overall the quality produced has been very good and it appears that there will be enough hay to supply both the export and domestic markets."

Freeling hay producer and trader Tom Shanahan said there was a significant decrease in hay production this year, suggesting the commodity would be down by at least 40 per cent.

"Our production is probably very similar to last year but down a bit," he said.

"Due to dry conditions we have had crop failure with some of our oaten crop production in Melrose."

He said there had been recommendations made to reduce the area sown.

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"A lot of producers who were clients of an exporter were recommended to reduce the hectares they were putting in," he said.

Nationally, Mr Shanahan estimated there was a carry-over of about 50,000 tonne on the domestic market.

"A lot of people looked at that and decided there was not much sense in running the risk again so reduced hectares accordingly," he said. "I have seen guys go from planting 1000ha a year to 100ha and that was quite a big drop.

"Obviously grain prices were starting to strengthen just prior to seeding and a lot of people thought why have the headaches with hay or the uncertainties associated with it and they just put more cereal or predominantly legumes, were the big swing too as it were."

Mr Shanahan said a lot of people decided to grow lentils or canola in lieu of hay to generate more money per hectare with less risk associated.

"At the time of seeding, lentils were trading at about $700/t and even if you grew 1.5t/ha of lentils you were grossing $1000/ha," he said.

"With hay production because you can range from $85/t up to $250/t, crunching the averages meant producers were nowhere near that amount of gross income and then, add in the associated costs with producing hay, like baling, it is a lot higher than just harvesting."

Despite recent bad weather, there were positives, particularly following a year where 85pc of their hay was affected by weather.

"This year our quality was up, which was the biggest winner for all exporters," he said.

"If we were to have another year like last year it would have been catastrophic for the hay industry in this state because there is still a wingload of damaged hay sitting in sheds.

"Our production would be back by about 25pc in both yield and hectares planted at our Melrose property."

He said yields were at 3.8-4.2t/ha, rather than their usual 5.2t/ha, but the expected price had lifted.

"Typically the average price we received last year was between $90-$120/t, depending on damage it occurred, and this year our hay will typically average $140-$230/t due to quality," he said.

The decrease in hay production has been seen in many regions across SA.

Murray Bridge hay producer and supplier John Talbot said while he reduced the area sown this year, his overall yields have also dropped, because of a dry August and September.

"Yields are down considerably, the height in the crop would have been about 700 millilitres where it is usually one metre," he said.

"Some areas such as Murray Mallee, Pinnaroo, Lameroo, through to Loxton, they could not cut at all as it's too short.

"I put half my usual crop in this year, which was around 200 hectares of Wintaroo oats and Compass barley for hay, where usually I'd do 300ha."

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Mr Talbot said he grew 25 per cent for his cattle and the other 75pc he sold to feedlots, dairies, and large cattle properties.

"Demand will increase if it keeps raining because the goodness will be washed out the feed," he said. "You can have fantastic feed in a paddock but it's not worth anything if it's all been bleached with rain."

Mr Talbot said predictions in the long range forecast had put many people off sowing hay.

"The thoughts at the time of seeding were, it would be wet all the time," he said.

"If the hay goes to black after many rotations, it gets to the stage where it's not even worth bailing and you've done your money."

Hay producers considered the risk of losing money to downgraded hay and also the prices, which would be achieved in the market because there was a lot of oversupply from last year, Mr Talbot said.

"Most people kept a lot of their quality feed back from last year," he said.

"The demand is not there. What we relied on before was the interstate demand right through Vic, and particularly NSW and Qld and that demand has dropped completely right off to virtually nil.

"I called into Nutrien who said they had sold some net wrap and string they had left from 2020 but they ordered a third of last year's order and will not sell all of it."