Hay ‘soaked-up’ as market hinges on autumn break

By Dairy News

FEARS OF fodder shortages still hang over the dairy industry with no signs of demand easing this season.

Australian Fodder Industry Association chief executive officer John McKew said new season’s fodder had been soaked-up due to a “very empty pipeline”.

He said there had been dairy farmers busy securing hay in advance, but worried what supply would be like if mother nature isn’t co-operative in the coming months.

“I’m very concerned about the outlook if we don’t get an autumn break this year that is meaningful,” he said.

“I’m very concerned with the supply and demand, about what prices might look like in April and May, we could find ourselves in a worse situation than the end of last year.”

In the middle of last month, there was little movement in hay prices across Australia with values remaining at elevated levels.

Mr McKew said demand had eased during the Christmas and new year period, with “marginal” price movements reflecting changes in local seasonal conditions.

In mid-January cereal hay traded between $250 – $330/tonne in south-west Victoria and $430 – $530/tonne on the Darling Downs in Queensland, according to Dairy Australia.

Mr McKew said “patches” of good hay yields in southern Australia hadn’t been enough to fulfil strong demand and refill empty stocks.

“What is being produced currently this harvest season is going into a very empty pipeline at the moment and it is being soaked-up,” he said.

“You can buy it (hay) but you probably won’t like the price, but (buyers) haven’t liked the price for the past six months.”

There’s been a “reasonably high degree of over-the-fence trading going on”, according to Mr McKew. He said some dairy farmers sought to secure supply earlier rather than wait until “the 11th hour.”

Haystack fires have also been a concern in Victoria, following heavy rain which resulted in high yeast and mould levels in fodder stored outdoors.

One Victorian southern Mallee hay producer, who did not wish to be named, told Dairy News Australia he estimated 8000–10 000 bales could have been lost to the market due to haystack fires this year.

Dairy Australia analyst John Droppert said hay markets would be volatile with a huge spread in prices reflecting the lack of information about the market and varied quality of the product available.