Iowa is importing hay from Texas. "Last year at this time we were sending hay out of Iowa to Texas. They had the severe drought in the southwest last year, and we have it here in the Midwest this year," notes Dale Leslein, manager of the Dyersville Hay Auction in northeast Iowa. The location at Dyersville is a weekly market which attracts hay buyers and sellers from a wide area.
Leslien said last week some hay is being hauled in from Texas, all the way to Dyersville, which is ironic because this time last year, Iowa was sending Iowa-grown hay to Texas. But things have turned around in the Upper Midwest this year, with the widespread 2012 drought. The drought is here this year, and was in Texas last year.
There is quite a bit of hay available in Texas now, he explains. There's a shortage of cattle in the southwestern U.S., as drought there the past couple of years resulted in cattle producers having to cull their herds. So they presently have a surplus of hay and even some of the pastures are being baled up this summer in Texas. Pastures are being baled because of the lack of cattle in Texas and ample grass. More of that hay may start finding its way to the Midwest.
Release of CRP acres has affected prices a little, but hay demand is still strong
What are the price ranges for hay being sold today at Dyersville? For good quality hay currently—the market has backed off about $40 a ton from recent highs. USDA on August 2 released Conservation Reserve Program acres for emergency haying and grazing due to the drought, so that's taken a little bit of pressure off the market. Leslein is looking for the hay market to bottom out in the next month or six weeks, "but right now we're still seeing the very good hay, the dairy quality hay, in the $250 range in big square bales, and round bales in the $180 to $220 range."
The lower quality CRP hay isn't bringing as much as the higher quality CRP hay. "There are very few what we call 'managed' CRP acres," he explains. These are people who spray for weeds and keep their CRP acres nice and clean. The clean CRP hay is bringing $120 to $130 for round bales, all the way down to the low $60 a bale price for the stuff that has trees, weeds and sticks in it.