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Serving: MO

Develop management plan for hay, increase profits

Mindy Ward Round hay bales being loaded on to a trailer
READY TO SHIP: Hay production is increasing in parts of Missouri, and farmers are loading it up to sell to buyers from across the country. In recent years, forage has become another way to diversify cash flow on the farm.
Hay is more than livestock feed; it’s a growing cash crop in Missouri.

This year’s hay is stored away in the barn or wrapped tight in the fields, just waiting to be fed to livestock over the winter. However, Jason Morris, University of Missouri Extension ag business specialist, says that farmers should look at their hay not only as forage, but also as a crop.

Morris says there has been an uptick in harvested hay acres. According to the USDA 2020 State Agriculture Overview, Missouri has 3.23 million hay acres, including alfalfa, producing 6.3 million tons. Morris points out that in northeast Missouri alone, the number reached 229,000 acres, accounting for 408,400 tons of forage.

“When adding grazing and conservation to the mix, there is a $12 billion input to the economy of Missouri,” he explains in an MU Extension Ag Connection newsletter. “This income directly impacts more than 200,000 Missourians.”

Missouri ranks third in the nation in cow-calf pairs, accounting for more than 4 million head. The state also is second in the nation in grass hay production. But Morris contends beef producers are not the only ones growing forage.

“Indications show traditional row crop farmers who have little or no livestock are devoting more acreage toward hay production,” he says. “By doing so, farmers are providing more diversification while increasing farm resources.”

Morris notes that adding forage to a farm’s crop system bodes well for traditional crop farmers who routinely focus on developing crop management and marketing plans.

However, for most livestock farmers, their time is exhausted growing row crops and forage as feed. They simply do not have the time to look at hay as an additional cash crop.

Problems for hay growers

Still one of the barriers to truly having hay as a traditional cash crop comes in marketing.

“There are very few auction houses or businesses to accept hay when compared with grain elevators for those producing grains,” Morris explains. “Adding to the complexity, hay is not an individual crop such as soybeans or corn, but exists of many crops such as fescue, clover and alfalfa, to name a few.” And hay comes in various sizes and forms from small and large square bales to small and large round bales.

Morris says that one of the most common difficulties in marketing hay is the lack of standardized grades used for value.

“While hay is often shipped great distances, there does not exist a national or standardized market structure as it exists for corn, soybeans and cotton,” he notes. “Due to the structure and weight of hay, markets are typically more localized. Because of this, data reflecting the pricing of hay is virtually nonexistent.”

As the value of hay should represent both the weight (volume) and nutritional value, most pricing is determined between the seller and purchaser.

Unlike other agriculture commodities, such as corn, cattle or swine, which have a national pricing system, hay value is determined through laboratory analysis.

Understanding the quality of hay is important for each party since there is limited research or even published pricing, Morris says. “Producers can utilize marketing strategies to sell their hay product and improve pricing for it," he says. Morris contends the simplest and best means of marketing hay is through forage-testing results.

Develop a marketing plan

Instead of waiting for buyers to come to hay farmers, Morris says, farmers should know their hay and target buyers.

“A forage improvement plan can increase both hay yields as well as profits,” he says. “Hay sample testing can be beneficial to the purchaser, as well as the producer.”

There are many different markets for Missouri hay. Morris points out a few:

• livestock, including beef, goats, sheep and others
• equine such as horses, mules, donkeys and ponies
• industrial mulch users
• hay brokers
• export markets

Morris warns farmers that with the increase in cash hay production across the state, they need to put a plan in place for surplus supply.

University of Missouri Extension contributed to this article.

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