A report from the University of California Agricultural Issues Center in Davis showed that the trade war with China is expected to push the price of alfalfa down 7.5% and cut revenue for alfalfa producers by about 377 million in 2018.
China had an 8% tariff on U.S. hay, but in response to President Trump increasing the steel and aluminum tariffs, China added an additional 25% tariff on hay.
China buys about 1.2 million metric tons of U.S. hay per year. It’s the number one export market for alfalfa hay and is second to only Japan for U.S. hay, according to AllHay.com. The demand for hay mostly comes from dairies in China. The summer months are often down for trade as China is able to produce their own hay, but they rely on the U.S. in the fall and winter.
“If China wants the highest quality hay from America; they are going to have to relent on their tariffs. Otherwise, American suppliers will increase their exports to other countries,” according to AllHay.com.
The value of U.S. hay exports reached a new high last year at about $1.5 billion, which almost quadrupled the previous two decades.
AllHay.com is a forum for buying and selling hay across the world.