READ FULL REPORT HERE.
Driving Prices Up
- Recent high impact rainfall events and flooding has further reduced expected Spring hay production. Rainfall has impacted broadly across most states with widespread reports of crop losses or crops which will no longer be suitable for high quality hay production.
- Many vetch crops, which had to be cut for hay prior to going in to pod, have been impacted by rain and weather unsuitable for baling. Most are now only suitable for in paddock mulch.
- Growers had already reduced hay crop plantings due to the continual rise in input costs. A growing number of producers have indicated they will hard pressed to harvest and process hay for existing customers with long-term, reasonable price, contracts.
- The loss of vetch hay crops, reduction in expected quality and quantity of other high protein hay options will lead to high protein hay shortages.
- Fuel costs will be factored into hay and sileage deliveries. Labour shortages and road damage will also impact timeliness of deliveries.
Driving Prices Down
- Good spring pasture growth potential is predicted to reduce the need for hay, providing paddocks are accessible.
- Expectations that the forecast wet Spring will support continuation of in pasture and in paddock feed options.
- The Bureau of Meteorology (The Bureau) predict a continuation of the La Niña event currently leading to high number of substantial rainfall events across New South Wales, Tasmania and Victoria. Up to 100mm of rain fell across central northern Victoria and up to 200mm in parts of Tasmania.
- With moisture profiles already at saturation point, continued rainfall events have led to many flooding events across eastern Australia. With further expected flooding over the coming days the damage to paddocks, crops and property will not be accurately measurable for some time.
- The wet weather has already reduced the quality of some product for the new season as it is impacting and in many cases halting the cutting and processing of early season hay and silage.
- Wet weather is leading to a high demand for fertiliser and crop protectants as growers look to maintain the health and quality of their remaining hay and grain crops.
- The return of the fuel excise led to increased costs for diesel deliveries to farms adding to the already high production and delivery costs for fodder. Deliveries are also being impacted by flooding and road damage from rainfall and flooding events.
- As the widespread damage to crops has become evident prices are beginning to rise across most areas. Exporters and the domestic market appear to still be waiting for stronger supply signals. There is an expectation that prices will significantly rise once the short supply is clear.
- Purchasers of hay with long term relationships and a willingness to recognise the need to pay a price that allows hay producers a reasonable rate of return are likely to be given first preference over any new season’s hay able to be produced.
- Buyers are encouraged to feed test and view fodder before purchase to be sure of the quality of feed.