WHY Does the Government Hate Hay Producers?

fantasymaker · #1 05/30/08, 03:02 PM

It seems like the USDA is in faver of any commodity going up EXCEPT Hay. Why is it every time that the cost of hay goes up a bit they release the CRP and dump the price of Hay? They dont do that with Corn , beans. cotten or anything else.
I wouldnt mind that nears so much but they dont support a floor under hay either like they do with other commodities.

Sabrina67 · #2 05/30/08, 04:36 PM

Never thought of it..but you make a good point. It does seem like hay is a forgotten commodity.

Scrounger · #3 05/30/08, 04:40 PM

The cost of hay and grain is already to high.

Sabrina67 · #4 05/30/08, 04:45 PM

I am not sure I understand how CRP works.....would grain and hay go higher.. Is there a place I can go and check it out. We don't raise any crops ...But being informed is always good

seedspreader · #5 05/30/08, 05:13 PM

Maybe you could draw the line between the prices and CRP a bit better?

That said... Hay is what American ACTUALLY runs on. Without it, where would we be?

brosil · #6 05/30/08, 05:18 PM

Hay isn't used as a chemical feedstock and therefore isn't important.

arabian knight · #7 05/30/08, 05:20 PM

Quote:

Originally Posted by seedspreader

Maybe you could draw the line between the prices and CRP a bit better?

That said... Hay is what American ACTUALLY runs on. Without it, where would we be?

That is so true and hay is so important to not only feed us but some of the world as well. So must be kept down as much as possible but hay has gone up by quite a bit since last year some horse barns are already feeling the pinch. And that is not good as well as so much hay goes into the feeding of food animals as well. Much of it does.

uncle Will in In. · #8 05/30/08, 05:56 PM

They allow the haying of CPR ground during severe dry conditions in various areas. It is to benifit producers who would otherwise be forced to buy overpriced hay, or reduce their breeding herds.

seedspreader · #9 05/30/08, 06:07 PM

Quote:

Originally Posted by uncle Will in In.

They allow the haying of CPR ground during severe dry conditions in various areas. It is to benifit producers who would otherwise be forced to buy overpriced hay, or reduce their breeding herds.

I suppose a stable herd size for reproduction purposes is pretty important overall. Dump a bunch of animals on the market and it may make the meat cheap for a season or maybe two, but in the long run... it could be very detrimental to the food supply over the long run to let that happen.

Mare Owner · #10 05/30/08, 06:22 PM

Hay is very high right now, even here where historically we have cheap hay compared to most of the country. I won't begrudge any farmer who can get a few extra bales baling the CRP land when he's allowed to.

Last summer we didn't get much rain and we saw several farms able to hay low ground that wasn't CRP, but was too wet to hay in normal years. We would have too if our land was that way!

I thought some farmers were taking land out of CRP to put in corn also. But I don't understand how that all works.

sammyd · #11 05/30/08, 07:48 PM

Releasing CRP has nothing to do with hay prices.

The USDA doesn't have price supports for vegetables either.
They don't hate ya that's just farming.

rambler · #12 05/30/08, 09:07 PM

CRP: This is a program the govt started many years ago to rent poorer ground from land owners, and put it into natural habitat type of grasses.

There is a bidding process, and the rent is decided upon, and there are very strict rules on keeping weeds out, planting only the specified and typically very spendy grasses & plants. Some areas there is a bonus for planting some trees as well.

It costs a lot to do this, so land owners are not getting 'free money'. Many of the rents were $90 or so an acre, which is 1/2 price of today's land rent 'here'. you typically have to sign up for 10 years, and you can resign for extra years. Very steep penalties if you do something not allowed with the land. The govt is renting it and calling the shots. As I mentioned, this is often wetter, or steeper land that isn't perfect farm land, but it did have to be in grain production to get into this program.

You need to fullfill the full 10 year contract, or the 1,2,5, or 10 year extended contract, or you will be penalized very badly for taking the land out of CRP and planting it.

In years past, they have allowed folks to harvest the grass for hay or pasture, but you had to refund at least 25% of your payment, and there were timing restrictions. Doing this keeps the price of hay down, which does hurt hay growers because these are times they would get a high price, but low yield on their hay farms. Now the govt comes along and kills their market.....

So, just a week or 2 ago, the govt iis going to allow 24 million acres of this CRP land to be harvested - that is MASSIVE, out of the 32 or so million acres of CRP. Also there is no repayment of any of your CRP payments. So, the govt is still paying you, and you get to harvest the hay - double dipping.

Many of us don't see that part as fair. It will hurt hay farmers, and be a bonus to the CRP landowner. This is worse for hay farmers than the drought relief. It is huge scale, and 'free' tot he CRP folks.

There will be many rules to it - you cannot harvest until bird nesting is over in your region, and you will need to maintain cover & grass & all. As harvest will be in fall, it will be tough stemmy hay, not top quality, etc.

The idea is to save the beef industry - without this, many folks might sell off their whole herd making meat prices low. Then next year there are no beef animals around, and meat prices will skyrocket, and grain prices will fall. I don't want to get into the whole ecconomics of it, but this is a bad situation - a real see-saw that hurts livestock people, grain people, hay people, and consumers - there are some low price dips in there, but overall it is a 3 year cycle that makes all of us poorer.

So, the intent is good - to keep beef supplies more level during this time of higher grain prices.

But as usual, it was hastily done, knee-jerk, mis-applied, and gives some double benifits while screwing over others who are trying to run their business the old fashioned way.

--->Paul

seedspreader · #13 05/30/08, 09:45 PM

You mean there were unintended consequences??? lol.

Sabrina67 · #14 05/30/08, 10:37 PM

Thanks for explaining it.

I had heard of the program, just wasn't sure how it went.

farminghandyman · #15 05/31/08, 01:02 AM

At one time it was the same with grains, ever time the price would start to rise they would dump government owned grain on the marked that they had had turned over by the farmers to the government with the loan programs. and the reserve program would release grain three years later,
currently there is not a reserve program. and the loans have not been used my many do to the fact of higher prices, and if they were they were used the grain was redeemed instead of being turned over to the government.

sammyd · #16 05/31/08, 03:20 AM

Realistically, what sort of hay will be made on CRP ground? And how much?
Maybe something you can mix it in with decent hay to stretch it a bit I suppose.
If you're growing good quality hay that is used by knowledgable farmers I wouldn't worry too much. Nobody who knows hay is going to confuse 50 dollar a ton bedding with 120 dollar a ton alfalfa or try to get you to sell your alfalfa for bedding prices.

Scrounger · #17 05/31/08, 04:28 AM

Actually, they are releasing the acres for haying in mid June, so it won't nesessarily be "stemmy" hay......

I bale my own, and don't have any CRP, so it doesn't really affect me. I hear horror stories of high dollar hay from people all over the country, but hay here has been steady for years. The people I have talked to don't expect that to change. There also isn't a lot of "hay ground" being tore up for corn, either.
Here, locally anyway, opening the CRP won't really have much effect on hay prices - not many plan on haying it anyway, and hay is usually plentiful, even in drought years.

Now, if it lowers the price of grain, I'm all for it........

Chuck R. · #18 05/31/08, 08:25 AM

Quote:

Originally Posted by sammyd

Realistically, what sort of hay will be made on CRP ground? And how much?

As Scrounger pointed out it depends on when it's cut. I bought 80 acres in the past couple years of which about 45 was in CRP till last fall. The guys at our county extension office tell me that it can be hayed and make decent hay, IF it's cut early enough. I had about 15 acres cut last year right when it came out of contract and managed to sell all but a couple bales.

I've now worked a deal with my farmer to turn that field into hay by doing the next couple years in corn. One thing about CRP is its a PITA and expensive to get rid of it. I'm trying to work the same deal for my back 30 acres.

Chuck

ceresone · #19 05/31/08, 08:28 AM

I'm paying 6.75 a bale right now for grass hay-- was paying up to 8.75--and thats small square bales, used to pay 2.00 delivered to the barn--sure gone up here

Scrounger · #20 05/31/08, 09:04 AM

Quote:

Originally Posted by ceresone

I'm paying 6.75 a bale right now for grass hay-- was paying up to 8.75--and thats small square bales, used to pay 2.00 delivered to the barn--sure gone up here

The price went up in SE Nebraska, too. Last year it was $2.50. This year guys are talking $2.75 to $3. Alfalfa is hovering right at $4....