Register To Bid at our DV Auction Site

American Ag Video Auction News & Updates

UPCOMING AUCTIONS
Held the
2nd & 4th
Wednesday
of the Month
at 6 p.m. MST

 

CONTACT US

OFFICE
605-717-5888

747 N. Ames St., STE 2, Spearfish, SD 57783

OWNER/AUCTIONEER
Tom Baer
307-703-4020
tom@AmericanAgVA.com

MARKETING/ADVERTISING
Wendy Fischer
wendy@AmericanAgVA.com

We Offer

Need assistance finding transportation?

HaySoftware

 

October 2016

YAH, BUT IT'S CHEAP....

"Cheap" hay may be the most expensive hay you buy!

In a business where I see, test, and sell hay from all across the country I have watched buyer trends in the hay market from many different angles. Ranging from buyers seeking supreme hay with high feed values to low end grinder hay with very little protein and value. At some point I must ask the inevitable question- Where is the value mark in hay buying and hay feeding? Now if you are expecting me to launch into a long dialogue of college studied facts and experiments you are going to be disappointed because frankly that is neither my style nor my place. What I like to do is give a down-to-earth perspective on different situations and experiences right from the good down-to-earth folks I have the pleasure of doing business with and straight from the pickup tailgate office or the bale of hay desk where these discussions take place.

So what is value when it comes to hay? What should I be buying and feeding and why? I compare hay value to many things in life that every one of you experiences every day. Some of you drive Ford, some drive Chevy some drive Dodge. Is one better than the other? Probably but honestly it's a matter of opinion and what dad drove or whether or not you have had a bad or good experience with one or the other. Let’s also keep in mind the phrase that we have all heard since childhood – "you get what you pay for.” This may be one of the most profound statements ever made when it comes to hay. What I'm saying is hay values from one angle can be somewhat similar to the truck you prefer to drive but very different from another angle such as "you get what you pay for.” You may like alfalfa because you have had a good experience with it, while others prefer green soft grass hay because that has worked well for them in certain situations or with their livestock. While others choose only bright green alfalfa to feed their livestock no matter what feed value is the next person has done just fine with hay that is a little brown and had a shower of rain on it. This is all fine and dandy but hay is not just hay, values go much much deeper than this and we can prove it to a certain degree with lab tests and feed results. Although, there is always a variation in labs and results which causes huge frustration to many, the truth is that when hay is handled and sampled properly with the right equipment lab results are a very good guide for buying hay of value.

In watching different patterns of buyers and understanding their end goal I have often thought to myself- " don't pay for a Prius and expect to get a Corvette, they are nothing alike and nothing about them is comparable. If you want to drive a Corvette and experience all that goes with it, then you have to pay for it, it's really that simple! Now of course there are times when you get that "smoking deal" on a Corvette or that Prius but at the end of the day you are still "getting what you paid for" It is much the same for hay, sometimes in a down market you get a "smoking deal" on very high quality hay but generally wherever the market is, that is where the price is for different qualities of hay. The kicker to all this is that when the hay market is very depressed such as it is as I am writing this, your price gap shrinks while the value gap expands. In other words, the market for low quality poor grinder hay with 6% protein and 85 RFV may be $70/ton while the market for bright green excellent high desert alfalfa containing 19% protein and 160 RFV is only $100/ton this is what I mean by the price gap shrinking while the "value gap” widens dramatically! To put it very simply you are getting twice the hay value for a small percentage more money or you are buying a Corvette for not that much more than a Prius! Again-hay is not just hay!

Another thing I often hear is this - A cow can get by on junk hay and cake, and make out fine through the winter. While this may be true in some aspects I have a few questions for hay buyers to ponder: Why are you buying very expensive supplements to make up for low quality hay? Think about this, you could buy some of that cheaper hay, as well as some high quality hay, feed or blend them together and do away completely with that high dollar supplement! Not to mention the extra value ingredients that comes along with alfalfa and better hay. I somewhat understand the thinking when good hay is very high priced such as during exceptional drought years but this should be the exception not the rule. I firmly believe that if livestock owners sat down and really looked at this issue long term, taking into consideration breed back percentages, health of calves, weaning weights, shape and health of cows over a several year period they would find this- "cheap low quality hay is the most expensive hay to buy!” As a livestock producer ask yourself this: Why am I paying high dollar for supplements and too much for "cheap" hay? Why not pay just a little more for quality hay and get the results quality hay brings? Are you really seeing "real value" from cheap hay? Are you buying protein and feed value, livestock performance, health and long term payback or are you paying way too much for average hay to "git er through.” Remember the term “you get what you pay for” comes into play, but honestly with the hay market where it is now, you are getting way more than you pay for when buying high quality and way less than you pay for when buying low quality!

I’ll leave you with this last thought - keep in mind "you get what you pay for." Right now nearly every producer has that rare opportunity to buy low cost value in the hay market and actually get "more than what you pay for." Taking advantage of this value should not even be a question! Hay is in abundance and commodity prices are lower than we've seen in years. So low in fact that you can nearly get all the value that goes along with the Corvette for darn near the price of the Prius! Just remember- cheap hay may be the most expensive hay you buy!

Tom Baer, Owner and Auctioneer