Rain outlook boosts high yield prospect

The ideal growing season for pasture and crops is taking shape with forecast rain to consolidate bumper growth.

August rainfall is reaffirming this year as a great growing season for pasture and crops. Picture: Zoe Phillips

FOLLOWING the dry July and worrying frosts, August rainfall is reaffirming this year as a great growing season for pasture and crops.

Many regions have already achieved their average August rainfall.

Less than 5mm is forecast this week, which will help paddocks to settle and allow grazed pastures on dairy farms to recover from herd traffic.

The season to date and the rainfall outlook for the next three months are increasing the chances of paddocks producing high-yielding hay and silage.

While broadacre hay growers have a strong incentive to forward-sell hay, buyers are showing little interest in cereal hay ahead of baling.

However, vetch hay is more in demand, as supplies are generally tighter, with the higher quality lines running dry early in the season.

The hay market is at a major reset point. In the past two years, the cereal market has mostly traded at more than $250 a tonne ex-Mallee or Wimmera farm and vetch hay at more than $300 ex-farm.

But what are the more typical prices for cereal and vetch hay to consider for new crop?

In the past 10 years the mid-point or decile-five price for cereal hay and vetch hay delivered to Goulburn Valley farms has been $210 and $285 a tonne respectively.

Allowing for a typical $35 a tonne freight back to a Mallee or Wimmera farm puts this decile five price at $175 for cereal and $250 a tonne ex-farm for vetch hay.

Some dairy farmers have shown some early interest in purchases of vetch hay.

Following the dry July some early-sown vetch paddocks have started to flower and contractors expect to be cutting vetch crops in the northern Mallee north of Speed in the first week of September.

As many growers recognise, when the market is expected to be loaded with hay, quality will be a key factor in finding a buyer this season.

To maximise the quality of their crops for hay, growers have little choice in cutting them when they are mature.

However, the success of curing a vulnerable, thin-leafed windrow of vetch in September when the Bureau of Meteorology has signed a La Nina alert could be challenging.

Some of the first forward-sales of vetch hay from the Mallee have been made at $260 a tonne ex-farm plus freight and a $25 a tonne storage and interest factor.

This price appears reasonable to both buyer and seller given the historical averages and the risks of the season.

With the early break this year and vetch a popular crop to sow, vetch hay supplies remain unclear.

Some growers plan to dedicate their crops for seed, as vetch seed has been expensive this year.

Depending on the spring rainfall, temperatures and intensity of fungal growth, other vetch crops may be sprayed out and used as brown manure to boost soils for subsequent crops.

MORE

New crop confidence buoys futures, pressures old grain prices

Dry end to winter ahead of expected wetter-than-average spring

Slight lift in local wheat futures