Are tighter hay supplies in Ontario’s future?

Commodity crop prices are sky high. The same can’t be said about Ontario’s hay.

A generally good 2021 production season contributed to a glut of dry forage, lowering hay prices across Ontario. In the face of much higher-value commodities, acres that would normally be reserved for forage production, specifically dry hay, are being turned to other crops. 

The result could be reduced domestic supplies later in the year and into 2023. 

Why it matters: The balance between dry hay supply and demand can tip quickly. The reduction of forage acres this spring could have a ripple effect on inventories in future years.

Chris Martin, chair of North American exports for the Canadian Forage Council, says carryover supplies from 2021 are driving down the sale price of dry hay in Ontario. The combination of record high fertilizer costs and the value of other commodities means forages can’t compete when it comes to share of field space.

Initial assessments for the United States suggest a 15 to 20 per cent reduction in forage acres, Martin says. An initial estimate for his own area north of Kitchener-Waterloo suggests a 10 per cent reduction. He speculates some growers might take a first cut before repurposing the land.

While the level of production on remaining acres is a significant factor, the future could feature a much tighter supply in Ontario.

Deb Campbell, agronomist and owner of Agronomy Advantage Inc., expresses a similar concern. Seeing farmland converted away from forages this spring prompted her to notify colleagues on social media.

In a call with Farmtario, she reiterated the ease with which hay supplies and demand can fall out of sync.

“I’m seeing that shift happen a lot,” says Campbell, referring to her operational areas in and around Grey and Bruce counties.
“Even a hay producer needs to spend money on fertilizer. You can hardly make that back in the hay market. Those acres could be in a very high value soy crop this year…I’d hate to see some of those hay crops being removed from the rotation.”

Campbell adds a relatively dry spring across much of the province has also been conducive to earlier field activity and the removal of forages in favour of soybeans.

Ontario’s dry hay crop is usually consumed in-province, though livestock producers in other parts of the country could well use Ontario’s current surplus, notably those on the Prairies.

However, Martin says the fuel expenses associated with shipping forages have suppressed the viability of shipping hay long distances.