There must be some grass growing

We have hit spring, but hay and silage season is still a few weeks away. That hasn’t, however, stopped hay markets from falling as sheep and cattle producers are finally seeing some grass growth, and dairy farmers can see light at the end of the tunnel.

As we opined in the last update on hay, prices were always going to fall from the extreme winter highs, and they likely still have some way to go yet. Figure 1 shows pasture hay prices stayed at their peaks of $600-700/t in South West Victoria for around a month before tanking heavily in late August.

South West Victoria pasture hay has declined 25% from its peak, but remains historically expensive at $440-530/t. Central West NSW pasture hay didn’t get as expensive as in the south, reaching a peak of $570-650/t in July, and it hasn’t fallen quite as far. Central West pasture hay has lost 16% from its peak to be in the $470-550/t range now.

In the West, hay prices have remained steady at what are record highs for the state. Plenty of hay was trucked east at the peak of prices, which may have seen supplies tighten enough to hold value in the west.

With animals exiting containment in drought-hit southern zones, straw prices have also tanked in recent weeks. In South West Victoria, straw is almost back to a more normal rate, under $200/t. Straw supplies will soon be replenished; there is a little more uncertainty about the supply of good-quality hay.