California Alfalfa & Forage Association
Nov 6, 2004 12:00 PM
If history is a good indicator, the strong 2004 hay market is a signal that California will see a reversal in the two-year decline in alfalfa acreage. On the other hand, there are usually several major factors that dictate whether the odds favor jumping on the bandwagon or being cautious and staying on the sidelines.
Trying to get a handle on planting intentions and market trends is a lot more difficult than predicting where your favorite football team will finish at the end of the season. Going into the 2004 season, it wasn't hard to look at the old crystal ball and see that the San Francisco 49ers would be a bad team, Cal would be a top ten team, and the Oakland Raider's would be the same old Raiders despite a coaching change And, it's always a safe bet that if there's success in Dallas you can count on hearing “how bout them Cowboys” from the diehards who bleed Cowboy blue.
It's harder to handicap the hay market and the early predications for 2005 come with a number of disclaimers that usually surface, such as water availability, the dairy industry and alternative crops. The forecast for the dairy industry remaining in the black should get a boost from softening corn prices and expectations for a good worldwide supply of coarse grains.
Water, of course, is also at the forefront of dictating whether alfalfa acreage in 2005 will take a significant jump as it did after strong hay markets in 1997 and 2001. Tight water supplies are being cited as a factor that reduced alfalfa production in some areas of California after a good start to the beginning of the 2004 season.
Despite initial reports of good seed sales, it's still too early to get a good handle on fall plantings. And, the forecast for spring planting is being tied to moisture levels this winter. In late October, we talked to a seed company rep who confirmed that water concerns are keeping San Joaquin Valley growers on the sidelines, especially on the Westside. With smart money betting on a low carryover of hay going into 2005, however, it's logical to assume that the early season hay market will be strong even if fall plantings take a big jump.
About time
Over the last year or so CAFA has had conversations with a consultant who works for a company that serves the hay and forage industry. While he has a limited ag background, he's familiar with the cotton industry's success as a powerful commodity group. He's puzzled why the alfalfa and forage industry hasn't organized nationwide since alfalfa and other hay rank total crop value behind corn and soybeans.
The idea is finally taking hold, with the recent announcement that three forage associations have launched the National Alfalfa Coalition. The three groups are the National Alfalfa Alliance, National Hay Association and American Forage and Grassland Council. The national coalition will monitor legislation in Congress and work to promote research projects.
For many industry members, the announcement of a national coalition will no doubt bring the same response: “It's about time!”
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