Hay demand stalling prompts warnings from market experts

As fodder demand stalls across eastern Australia, even hay experts are unsure of when the market will bottom out. But they still have advice for how growers can make the best of the difficult situation.

Cut hay lies in a paddock. Demand has stalled

HAY growers may need to wait until well into next winter to sell any of this season’s crop as fodder demand stalls.

Good autumn and winter rain and pasture growth across much of eastern Australia has dried up demand for hay and straw.

Feed Central inspected about 300,000 tonnes of hay last season as drought spiked demand but general manager Cieran Maxwell said the company’s phones were “very quiet now”.

Mr Maxwell said hay sales had been low since February with trade virtually stopping overnight after rain.

“We are in our 19th year of trading hay and historically we have never seen such a blunt turnaround in hay demand so quickly,” Mr Maxwell said.

“The demand has remained low ever since except for some interest in high protein hay, and 2020 was one of those years when winter demand did not kick in.”

Mr Maxwell said hay makers would need to be patient this season.

“We would advise hay growers to make as much hay as they think is profitable and be prepared to come back in price to sell some of it and then store some,” he said.

“It is hard to know when the bottom of the market might be — whether it will be the end of this year or early next year is anyone’s bet.”

Australian Fodder Industry Association chair Frank McRae predicted a “massive year for fodder”.

“Given the volumes of crops we are going to see in southern NSW and Victoria especially, we won’t get the quality and in some parts of NSW, the crops are even too big to make hay so will be cut for grain,” Mr McRae said.

“Every farmer will be replenishing their own supplies and filling sheds and I can’t see that demand will pick up until next winter.”

Mr McRae said one of the association’s members had visited a machinery repairer in central NSW, where 50 balers were waiting to be serviced.

“There will be a lot of money spent on gear this year to get the hay cut,” he said.

Jumbuk Consulting director Colin Peace, who is The Weekly Times Hay Talk columnist, said there was nothing unusual about the coming hay season.

“In some ways, the hay industry was spoilt by drought with high prices and we need to re-educate ourselves of how the market operates in a normal season,” he said.

“Analysis I’ve done over the past 20 years shows that from November to June, hay appreciates by $3-$4/tonne/month, but the market is always set by the weakest seller and the strongest buyer.”

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