SAUK CENTRE, Minn. — Hay and straw bedding supplies are adequate in the region, but values are holding up, perhaps because of talk of potential drought in the region.
Alan Wessel is co-owner of Mid-American Auction Co. Inc., at Sauk Centre, Minn. Mid-America has been in business for 50 years, and established the hay auction nearly 30 years ago.
Wessel and partner Kevin Winter hold hay auctions the first and third Thursdays of the month, September through May, and once a month in June, July and August. (The company also conducts farm auctions and livestock dispersals, primarily dairy herds.)
The most recent Mid-America hay auction on March 4 was a big one. It drew 200 loads and 100 bidders. (The record-high was 230 loads a couple of years ago.)
“It’s traditionally a time when sellers … think it’s the optimum value. It’s also a time that many producers are a little short on feedstuffs this time of year,” Wessel said. “That coincides nicely.”
Some buyers represent large dairies and purchase multiple loads. Others may have beef cattle and need only one load to get to pasture time. Some participate weekly to provide feed for cattle.
30 seconds, tops
Hay sells by the ton and is based on quality.
Sellers preregister the weights. The auction company takes samples to a nearby Dairy Herd Improvement Association laboratory in Sauk Centre. DHIA verifies its “relative feed value” — an index for nutrient value, comparing it to “full bloom” alfalfa hay. The lab tests moisture and other components, and it’s all posted on bright placards with each load.
Typically, hay sells for $1 per point of RFV, Wessel said. A load of hay testing at 150 to 160 RFV likely goes for $150 to $160 per ton. Buyers might pay more if it comes from a particular seller.
A typical load is sold in about 15 to 20 seconds — half a minute at the most.
“We’re in the heart of the heart of the dairy industry here, kind of on the line,” Wessel said, with more dairy to the south and beef cattle to the north. Buyers coming from a long distance can expect a “good, steady run,” and adequate supplies to pick from.
Many of the hay sellers have commercial trucking businesses and deliver the product to the end-users, typically $4 per loaded mile to the destination. Mid-America makes its commission from the seller, with no “buyer’s premium,” to the purchasers.
'Pretty big deal'
Norman raises hay and grain with his brother, Jesse, at Norman Brothers Farms. About 20% of the Norman farm economics depends on hay. Hay production is famously labor-intense.
“I tell people the reason we raise hay is so we have something to do every weekend of the summer and the Fourth of July,” he said, only half joking.
Robert Rinkenberger, Morris Minn., who raises alfalfa and grass hay on about 250 acres, works with his son, who has his own hay. The two have been coming to the auction for 20 years or more.
Norman’s farm brought 100 tons to the Sauk Centre sale — the production of about 25 acres. The farm brought four different loads from last year’s first-, second- and third-cuttings.
The quality and value of hay cuttings tend to increase through the year. With each cutting, the stems become shorter, with more leaves. Buyers paid about $1.25 per point for Norman’s hay.
It’s can be an “all-day affair” for a supplier bringing hay here. “You won’t get anything done at home," Norman said. Three of the loads went within 35 miles, and the farthest was about 100 miles to Sleepy Eye, Minn.
Norman and Rinkenberger sometimes travel 200 to 300 miles after a sale.
“We go wherever the buyer tells us to go. We’ve gotten home as late as 2 a.m. to 3 a.m. Sometimes we’re home by 5 o’clock the same afternoon,” Norman said.
2020 to 2021
Rinkenberger said a wetter year this year would likely mean more tonnage. A drier year would mean shorter supplies, with better prices for high-quality hay. “It kind of averages out. It kind of depends on how big the area is that‘s affected.”
The 2020 crop year was a reprieve from a string of several years with excessive or untimely rains. Rinkenberger pegged the crop as “a tad bit above average” yield, at about 5.5 to 6 tons per acre. Norman said his farm typically shoots for 4 tons per acre, and probably got about 4.5 tons per acre.
Both are wary about this year’s dry trend.
“I think we have enough moisture for a good first (cutting) crop, but we will need some moisture, which is unusual for us. We’ve been exceptionally wet for many years,” Norman said.
Both sellers indicate that the hay price is heavily influenced by what dairies are being paid for milk.
“If they’re getting a good price for the milk the hay price will be good, generally,” he said. “From what I talk to my guys, right now the milk is down. We’re hoping for a rebound there. It helps us, too.”
Cows eat more in colder weather, so a balmier March reduces demand for hay.
Cows need more bedding in wetter weather, so a drier March cuts demand for straw.
The ‘D’ word
Livestock producers are becoming more concerned about potential drought.
Most haven’t seen much moisture in the past 90 days, Wessel said. Wessel emphasizes he’s not hoping for drought. But “we often remind folks — as a selling point — that if we receive no more moisture in the next 90 … it’s good insurance policy to have an extra load or two in the shed."
(Wessel is quick to emphasize, however, that he is not hoping for drought.)
Wessel said livestock producers who buy hay in central Minnesota are “OK,” financially, but that’s sometimes hard to know.
“Most folks that are ag-related kind of mind their own business,” he said. They don’t tell their troubles — maybe to Jesus and no one else. So if they’re experiencing a little difficulty, they just kind of work through it. Work a little harder. Get up a little earlier. Stay up a little later. That’s the kind of folks we deal with here. That’s why we are so fortunate — really blessed — to work with folks in the ag industry.”