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Hay, It’s What’s For Sale

Written by Dennis Sun

“The World Wants Our Hay” was the headline of a story in Progressive Farmer earlier this month, written by Rick Mooney. While Wyoming is not close to any ocean ports, the quality of Wyoming’s hay makes it worth the cost of transportation.

High demand worldwide for quality forages, along with cheaper ocean shipping rates and recent discoveries in hay compression technology are radically raising the increased hay exports from America, despite the increased value of the dollar.  

The numbers tell the story.

The University of California, Davis developed a report last year that said, from 2004-08, the U.S. shipped an average of 2.8 million tons of hay overseas annually, and from 2009-13 the annual average jumped to 4 million tons shipped overseas.  That is an increase of over 46 percent.  

The report showed a couple of big reasons for the increase – demand from China and the Middle East and cheap shipping rates on cargo ships back to China. We all have seen pictures of loaded container ships coming into the western U.S. ports from China, and now they are filled with American hay on the trip back to China. Companies are offering really low rates for the back loads.  As one Extension Forage Specialist said, “It’s cheaper to ship a ton of hay from Long Beach, Calif. to Shanghai than it is to truck that hay from southern California to dairies in other parts of the state.” That means those dairies must go east to buy hay to operate on.  This is a great story if you’re selling hay. It’s not so great if you are buying hay for milk cows or wintering livestock, but that is the way it is.  

I’m sure you’ve read about what is happening in China now for those raising alfalfa, and it sounds like a comedy of errors. If you haven’t heard, China is now offering great subsidies for the farmers raising alfalfa, but the problem is that the producers really don’t know how to raise dairy quality alfalfa nor do they really understand how to operate the American or European hay equipment.  Knowing the Chinese and what they have accomplished in recent years, they will catch on.

Saudi Arabia and the United Arab Emirates (UAE) are two other growing markets for American hay. Just the UAE, not a large country, imported around 37,000 metric tons from the U.S. in 2008. By 2013, that had increased to 743,000 metric tons. Saudi Arabia plans to discontinue all new plantings of alfalfa by 2016, most likely because of a shortage of farmland and water.  But then they will have to bring in between 3 and 4 million metric tons of hay or other forages to meet their livestock production needs.  Race horses and camels need a lot of hay, you know.

Currently it is estimated that between four and five percent of the total U.S. hay production is exported. That’s not enough to influence the markets globally, but in the California Imperial Valley and the Columbia River Basin of Washington where at least 30 to 50 percent of the hay produced is exported overseas, hay exports matter.  

As water in the western states gets more limited, do we need more hay for exports or vegetables to feed America?