Haying

[Phred]

Rich & Cowboydoc,

What about the current economics of hay.
I know you can't pay the mortagage to say the least, but are you planning to pay for the equipment with the sale of hay. Or is the payoff in the stock that consumes the hay?

Fred

 

[cowboydoc]

Phred,
Hay is one of the crops that if you can get it made you can definitely make the mortgage payment. If I sell my hay at auction I can get $150 a ton. I get about 6 ton per acre. So I'm making $900 per acre on hay. With corn you can make maybe $400 if you have one hell of a good year and get 200 bushel an acre. My new baler I'll pay for in 3.7 years just doing my own versus having someone come and bale it for me.

Now you may ask why doesn't everyone hay then. Well it's very labor intensive. That hay that I showed that I put up I had about 50 hours in. I got about 85 ton of hay off of that 60 acres. When hay is ready it's ready too. I didn't sleep for two days because I was mowing. I went straight from work to mowing and mowed until it was time to go to work the next morning. Most guys don't want to put in that kind of work to do hay. Then if you don't get it right and you get rain you could lose your whole cutting. Then you still have to bale it and get rid of it as if you leave it in your field it will ruin your next cutting.

Myself I sell some hay but mostly I use it to feed my cattle and horses. I've got 197 calves that are ready to head to the sale next week. I've got them up at the feeders to get as much weight on them as possible. Most of my profit comes from the sale of my cattle. Over the winter I'll have the cows and horses to feed. This winter I'll feed over 200 ton of hay. As you can see I get my money back out of my hay equipment. If you only had a few acres then definitely it would not be worth it to buy your own equipment. You're way better off just to hire it done.

 

[MarkV]

Doc,

Here is a loaded question that I think you my best be able to answer. If someone wanted to be a hobby farmer and make income off of his land. How many acres would you think they would have to plant in hay, to make it worth buying hay equipment? I understand that the variables are to much for a definitive answer, but your best guess would be of value.

MarkV

 

[Gatorboy]

Re: Haying (Hobby)

I was out and about and saw some mini-bales of straw selling for $3.50 a piece. The city-folk were gobbling them up for their Halloween decorations.

These bales looked to me to be about 12"x16" or so. Now, I am not sure if there is a big market for these kind of bales, but it sure seems as though your profits are alot higher selling these small bales.

Anyone have experience with these?


Regards,
Dave "Gatorboy" Hoffmann
Fallston, Maryland

 

[cowboydoc]

Re: Haying (Hobby)

Last cutting Gatorboy I made about 150 of those bales. I have some people that do the exact same thing and pay me $2 a bale for them. The new baler will make down to a 6" bale.

Mark,
Boy that is a hard question. Do you want new or used equipment? If you want new equipment you are looking at 35k just for a mower condition, rake, and square baler. If you want a round baler add another $20k. If you want used equipment you can buy a decent mower conditioner for 3-5k that will probably need work, a square baler or round baler for $1500-5000 depending on the condition, and a rake for 1-3k. Figure that it costs about $15-20 an acre to have your hay cut with a moco and raked. Then figure it costs $7-10 a bale for a round bale and .75-$1.25 per bale for square bales. With that in mind figure your equipment initial costs and then how much land and bales you would have to do to pay for it. Also with regards to haying equipment it's broken down more than it's fixed so put maint. into your cost schedule as well. If you can do your own work you will save alot. But trying to get a square baler to knot has got to be one of wonders of the world. Then how many bales you get will depend on your ground etc. Like you said it's very tough to figure.

Also if you got new equipment you could do custom haying as well to help pay for it. All in all I would say if you were buying new equipment you'd have to put up 200-300 tons a year to make it pay. If you buy used equipment you could probably do half of that or alot less if you bought the equipment right. Say you only had 10k in the original equipment. If you hayed 25 acres you would save about $1000 - 1500 a year on three cuttings, and then it would depend on how many bales you did. If you got 150 bales per year per acre that would be 3500-4000 bales so depending on what you paid for a baler that could pay for itself in a few years but then you have the $$$ keeping the thing going. If you had round bales and per acre per year that would be 125 bales which would save you $800-1250. Then it would depend on your upkeep and how much again you paid for it. Yep tough to figure because there are so many variables but I would say a minimum of 25 acres for used equipment and 150-200 acres for new equipment.

With all that said as well you need to consider your time as well. I pretty much have it down to a science and I figure a minimum of 1.5-2 hours per acre to get a cutting and that's if you don't have breakdowns.

 

[MarkV]

Re: Haying (Hobby)

Richard,

Thank you for the information. I knew it was to broad of question for one answer to say it all. Sure does sound like a lot of work for the profit margins. We have a 30-acre tract that my father in law leases out, but the guys haying it don’t do much of a job. I was curious if it would pay to take over the job ourselves. Might make more sense to find someone better to lease to. Guess I’ll have to keep looking for a reason to buy a bigger tractor./w3tcompact/icons/smile.gif

MarkV

 

[cowboydoc]

Re: Haying (Hobby)

Mark,
You certainly couldn't justify new equipment for 30 acres but if you could find some good used equipment you might make it work. Depending on the soil and if you planted, fertilized, etc. right you could get probably 4-6 ton per acre per year. On 30 acres you would be looking at 120-180 ton of hay per year. Around here if you do square bales and it's really good alfalfa hay you can get $150 ton for it pretty easy. Even in a bad year you can $90-100 a ton for it, especially if you find either dairy or horse people to buy from you. But that is for square bales too which are alot of work. For round bales drop that price down about 30%. Depending on the year, soil, etc. you could probably make 15-30k off of that 30 acres haying a year, before expenses.

 

[Phred]

Re: Haying (Hobby)

Richard,

Thanks for the info.

I guess alot depends on the soil. In my area there is no way I can grow alfalfa. Its just to rocky.
So that leaves mixed grass.
Average yeild in my county is about 2.3 tons / acre based on
http://www.hort.purdue.edu/newcrop/cropmap/
just click on your state and then your county.
Now if you assume a price of $2.5 / square bale at a weight of ~50 lbs. That means square bales should be worth about $230 / acre. So 25 acers would net $5750, 50 acers would net $11500, etc...
Although it has been many years since I have stacked square bales I agree with you that the work is significant to say the least. (The above assumes that I would need to stack 4600 bales, based on 50 acers /w3tcompact/icons/frown.gif)
So consider round bales (I can handle these with the FEL).
Assume avarege cost of about $20 / 1000 lb bale, which leads to about a net of ~$92 / acre. Therefore 25 acers yeilds only $2300, 50 acers nets $4600, and 100 acers nets $9200.
The good news is that the same 50 acers only requires you to stack/move 230 round bales. And the bad news is that all of this does not include any costs (fertilizer, diesel, your time, etc..)
Altough I don't think most of the folks around here spend much on fertilizer, which is not cheap. This is also probably why the yields are low.

Does this ~ agree with your expereince.

Fred

 

[MarkV]

Re: Haying (Hobby)

Fred,

Thanks for the crop site. Looks like my area produces about the same as yours. I am also told that alfalfa just doesn't do well in our area. Looking at your numbers shows that it just doesn't pay to hay./w3tcompact/icons/smile.gif

Any ideas what lease rates are for this type of field?

MarkV

 

[cowboydoc]

Re: Haying (Hobby)

Fred & Mark,
If you can't produce alfalfa then no you aren't going to get the better prices for hay. Grass brings about 25% less than alflafa does on average. BUT IF you can find some horse people that like grass hay better than alfalfa they will pay more for grass hay than alfalfa. Like I was saying on another post people can spend a ton on horses that isn't needed.
Anyway, yes your figures are right. Also without fertilizing I have found I lose about 1.5 ton or more in yields. Nice thing about grass though is that you don't have to replant it every 5 or 6 years like alfalfa. As far as square vs. round bales you about have to go with square bales if you're going to sell hay to max. profits.