HAY processors have said they want to be proactive in managing grower expectations in light of the disruption of trade with China.
Munro Patchett, Gilmac general manager, said his company had decided to get on the front foot and warn growers prior to planting that it would be cutting orders this year.
"We want to give growers an option to plant something else so we're being very clear that we'll be cutting back the contracts offered this year," Mr Patchett said.
"If growers are out there planting their hay crops as per normal, without proper storage and expecting to get paid big money for it this year they are foolish.
"Some growers with the infrastructure may make the decision to grow the hay and store it with a view to selling when the market rises later, and others will have paddocks they have to cut hay for agronomic reasons but we're saying clearly there will not be as much export demand as usual.
"If you're growing hay you need to have a long-term strategy in mind."
Mr Patchett advised growers that wanted to stick with oaten hay to at least grow a dual purpose variety that can be taken through to grain.
"There could be a change in China's position later in the year, with a dual purpose variety if things remain the way they are you can take it through to grain or if an opportunity does arise, then you could cut in the spring."
He said he was confident of a return to normal quickly in coming seasons.
"If we work through this year with discipline I think we can bounce back quickly."
Colin Peace, fodder industry consultant and owner of Jumbuk Ag, said there was little incentive to increase hay plantings at either a domestic or international level this year.
"There is plenty of hay around still from last year to meet domestic demand, even allowing for some downgrading of the NSW hay crop, which got wet at baling, and now with China on the sidelines the export industry is also likely to be back.
"I'm confident export markets will bounce back quickly as there's other markets than China, but it has been a good move by processors to get out and be clear with growers about what is happening."
"You may see someone take a counter-intuitive approach and actually plant more hay as everyone else is planting less but I think overall we'll see hay hectares back, especially with good value in grains at present."
Gregor Heard
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
