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Column by Hal Walter

Agriculture – August 2006 – Colorado Central Magazine

THERE’S NOTHING like a drought — whether a long-term trend or a short-term dry spell — to make livestock owners edgy. Lately we’ve seen both sides of dry.

While an early July monsoon bolstered hopes of a better hay crop this year, the long-term trend has been drier than dry, and the demand for hay is outrunning the supply. These factors, combined with sky-high petroleum prices have bucked the price for a bale of hay to near record highs. At $5.50 to $6 per bale, or up to $195 per ton, hay is commanding a premium price.

That’s if you can find some for sale.

Just ask Mike Martin, owner of Martin Feed in Buena Vista. Martin hauls hay from the San Luis, Wet Mountain and Lower Arkansas valleys in order to provide his customers the convenience of buying hay from a feed store.

“It’s hard to find,” says Martin. “It’s just not out there — it’s going to be tougher than 2002, I think.”

Counting the travel, fuel and time commitment, Martin says he’s not turning much of a profit after paying top dollar for the commodity and then transporting it back to Buenie. He figures he’s making about 50 cents a bale for his troubles.

And his troubles may get worse. Warmer than normal temperatures last winter in the San Luis Valley led to a 60 to 80 percent loss of the alfalfa crop there. And low snowpack in the Sangre de Cristo Mountains has Wet Mountain Valley grass growers predicting hay shortages. Meanwhile, in the Lower Arkansas Valley east of Pueblo, hay farmers are relying on irrigation from the Arkansas River; the problem is that above-average snowpack in the upper drainage melted out fast in the early summer heat, and now farmers are hoping for more rainfall to irrigate third- and fourth-cutting crops.

David Getz who farms northwest of Center in the San Luis Valley says he lost some of his alfalfa crop to winter-kill, but fortunately grass filled in for the dead alfalfa on his 1,500 acres irrigated by pivot sprinklers.

“The grass really came on this year,” he says. “I put up a lot of grass-alfalfa mix for horses, and I’ll have a little dairy (alfalfa) hay but not as much as I usually have. It’s going to be a little light, but I’m still pretty pleased with what’s happening.”

Getz relies on runoff for some of his irrigation, and turns to well water when that runs out.

“Water is getting pretty thin,” he says. “They are starting to shut it down now and so it won’t last much longer and I’ll have to revert to wells then.”

Getz ships alfalfa hay to dairies in New Mexico, Texas and as far away as Pennsylvania. He says dairy owners are willing to pay the higher prices and freight for San Luis Valley hay because of its protein content and high relative feed value, which translates into higher milk yields.

“That’s why they come in here and get this hay,” he says.

Still, the expenses associated with raising hay push the price skyward.

Getz is charging $6 a bale for his horse hay this year; last year it was $4. For his dairy alfalfa he’ll likely be charging upwards of $150 a ton, up from $125.

“Everything went up,” Getz says, noting that he has the additional expense of electricity to run his sprinklers. “But getting customers to understand that is something else again.

“If I gotta pay more, then you gotta pay more. That’s all there is to it.”

IN THE WET MOUNTAIN VALLEY, where timothy and other grasses make up the traditional hay crop, Paul Schneider anticipates only 50 to 60 percent of his normal harvest. He says last winter’s 40 percent of normal snowpack in the Sangre de Cristo mountains, plus a lack of spring rain, left his 160 acres and 200 acres of leased hay fields south of Westcliffe drier than usual.

“It’s looking like $5.50 a bale for the primo Wet Mountain Valley grass,” Schneider says. “There’s not going to be very much of it.”

And in the Lower Arkansas, low spring hay supplies had buyers waiting in line to load hay out of the fields after the first cutting. They hauled away most of this year’s new hay.

“There’s very little and almost none depending on where you’re at,” says Frank Sobolik, Pueblo County Director of the CSU Cooperative Extension office. He says reduced late-season irrigation water in the Arkansas Valley points to higher prices and further diminished supplies later this year.

“There’ll be some but it’s going to be pricey,” Sobolik says, noting that drought and wildfires in Texas and Oklahoma had already tapped hay supplies in Southeastern Colorado and Kansas.

Sobolik says hay farmers in Pueblo County should have near-normal crops for their first and second cuttings, but the jury is still out on third and fourth cuttings later this summer.

High hay prices and short supplies already are forcing some stock growers to sell their animals, according to Sobolik.

“Unfortunately producers are having to cut way back to basic herd size because there is no grass,” Sobolik says.

Devin Cossel, who raises alfalfa and grass-alfalfa hay in the Boone-Avondale area, says the crop on his 350 acres of irrigated land appears to be down due to the early hot, dry weather.

“The yields are down, expenses are up and it’s just dry, dry,” Cossel says. “The combination of those things has really made the hay prices go up.”

Cossel also points out that rising fuel prices have increased farming expenses, with diesel approaching $3 a gallon and the price of petroleum-based fertilizer also on the rise.

He says even plastic baling twine, also a petroleum product, recently jumped from about $30 to $43 for a 6,500-foot roll. It takes more than 16 feet of twine to bind each 60- to 65-pound bale.

Cossel charges $5.50 to $6 per bale for his hay.

DURING THE DROUGHT of 2002, local hay reached these prices and then the supply ran out. I resorted to buying hay trucked in from out of state. At one point I put together a consortium of neighbors and we had a load of Kansas hay delivered to my place. It was $6.50 a bale.

While it appears such extreme measures will not be necessary this summer, the hay forecast still largely depends on what happens with the weather. The welcome early July monsoon brought a good dose of moisture, but it may have come too late. Even if supplies return to normal, it’s doubtful the price would fall dramatically just based on fuel prices. Some farmers tell me that it takes about a gallon of fuel to produce one bale of hay.

Schneider, whose family has ranched in the Wet Mountain Valley since 1874, jokes that with escalating prices, the hay business this year sounds like a current MasterCard commercial:

Fuel — $3.

Fertilizer — $10.

Twine — $43.

“And a gallon of water is not even there,” says Schneider, “so a bale of hay is going to be priceless.”

Hal Walter raises burros in the Wet Mountains, races them throughout Central Colorado, and cultivates prose when he’s not handling hay.