Hay gouging

[Sir Loin]

Alan,
Re:

One guy wants $265 per ton, another (huge hay outlet) wants $60 per ton.... please explain the justification in that.

I already did! It's called the free enterprise system which is governed by supply and demand.
You had the demand and two suppliers had the supply and you bought where you got the best price. Isn't that the same reason so many people go to Wal-Mart?
FYI every seller sets his/her margin of profit based on demand, NOT his cost alone.
You had a problem and you meet the challenge by dealing with it.

And take one attaboy out of the community chest and buy yourself a Dr Pepper for turning a roadblock into a hurdle.
Now get over it and move on to the next one!
SL


Re:

How much did those bales weigh that were bought for $25?

Around 1,200 lbs. But that is ilrelivent due to the high moisture content and the different amounts of grass in each.

In reality they did not really cost us $25 per bale if you subtract the $18 per bale it would have cost us to make our own hay (if we had had any to make).
SL

 

[Alan]

Its called marketing. Who on earth would pay a dollar for 20 oz of water when you can pump it out of the ground for about .20 per thousand gallons? Yet it happens. I don't buy bottled water, i would guess Alan doesn't either.

That's a decent point, and no I usally fill empty bottles with my own well water.

But let's use another analogy, you go to fill your truck with fuel at $3 per gallon. The station owner says no sale today, but when you want it bad enough I'll sell it to you at $12 per gallon... come back when you want it bad enough!

Alan

 

[dun]

Its called marketing. Who on earth would pay a dollar for 20 oz of water when you can pump it out of the ground for about .20 per thousand gallons? Yet it happens. I don't buy bottled water, i would guess Alan doesn't either.

You know what "Evian" spelled backwards is

 

[Beef11]

If you want Voo doo economics come over to my place. We use things like opportunity costs and ledgers.

 

[alftn]

Everything is costing more...hay also..but the drought here has been bad this year.The quality is down the price is up.. I payed 25$ a roll for grass/ weeds baled off of setaside was damn glad to get the 130 rolls(round) to help get to next year...also low/poor quality..Also my son let me have about 300 square bales of hy. ber. at 4$ a pice up from 3$ last year, but a damn sight better than the 10$ a sq. bale some are wanting... Cattle business is getting harder these days.. I will cull hard next year .Hope prices are up..

 

[dieselbeef]

Alan, don't you just love it when someone p's on your head and tells you its raining? Or when they try to sell a rat's arse hole to a blind man for a wedding band?

The last time we had a shortage, people ran hay up. Also didn't fulfill prior agreements made well in advance "cause they didn't have any" yet they were advertising in the paper as having hay for sale. Getting stuck once was enough for me to just do it myself. Kinda formed a loose coalition with another fella. Between the two of us, the hay guys now have about 4-5 thousand extra rolls they can sell to whoever they want. In my opinion, it was blind greed and foolish business practices on their part. Personally, I would rather sell several hundred rolls to one person who prompty pays me rather than getting an extra $10 a roll for the sell of one maybe two rolls at a time and maybe getting paid and maybe not. But that's just me. I'm not mad at any of these guys, just a little disappointed in them.

i still aint sure if yer bustin on me or not jogee?? did i do my math wrong??

 

[Jogeephus]

Alan, don't you just love it when someone p's on your head and tells you its raining? Or when they try to sell a rat's arse hole to a blind man for a wedding band?

The last time we had a shortage, people ran hay up. Also didn't fulfill prior agreements made well in advance "cause they didn't have any" yet they were advertising in the paper as having hay for sale. Getting stuck once was enough for me to just do it myself. Kinda formed a loose coalition with another fella. Between the two of us, the hay guys now have about 4-5 thousand extra rolls they can sell to whoever they want. In my opinion, it was blind greed and foolish business practices on their part. Personally, I would rather sell several hundred rolls to one person who prompty pays me rather than getting an extra $10 a roll for the sell of one maybe two rolls at a time and maybe getting paid and maybe not. But that's just me. I'm not mad at any of these guys, just a little disappointed in them.

i still aint sure if yer bustin on me or not jogee?? did i do my math wrong??

No Diesel, my comment wasn't directed at anyone on the board just at my view of a situation as I see it in my area and as I think Alan sees it in his. The creation of an artificial shortage is in my opinion wrong. I used to buy my hay. In the good years, the producers could just drop it off at my place at their convience and they would get payment within three days of delivery. They could even use my equipment to unload it. My order was placed in March and a price was agreed upon. When fuel went down and fertilizer went down, I still paid the agreed upon price. However, when a whiff of a drought hit our area and the peanuts didn't make, the price of hay increased and the producers "did not fill the order" yet they were advertising hay for sell at $10-15 above what we had earlier agreed. This cost me some money that year and also due to the poor nutrition value of the hay I could find, my calving rate dropped to 70% the next year so the effects last two years.

I vowed this was not going to happen again. Other than my reliance on fuel and fertilizer - and rain - I am self sufficient and know what the costs of hay production are in my area. These same producers are saying they have $50/roll in their hay due to this years drought. :shock: They are sitting on their hay waiting for someone to bite. But as Alan pointed out and hopes, they may just have a bunch hay to eat themselves since everyone made a bunch of peanuts. Another thing that these producers aren't figuring is with a shortage - even if man-made, prices should go up. With higher prices, more people will try to produce hay to meet the demand. So indirectly, these guys have just created more competition for themselves and as you know with competition - prices go down.

There is an old saying here that I think applies to my areas situation, "pigs get fat and hogs get slaughtered". I think the boys I'm thinking of are fixing to get slaughtered cause we now have five new contract hay producers in our area when in pre-drought we only had two.

 

[grannysoo]

Hogs get slaughtered. Excellent words of wisdom.

I bale my hay too in order to be self sufficient and not depend on the big hay sellers. I know what my cost is.......

The "big boys" in the hay business may make some extra money this year, but then they may end up next summer with a lot of hay left in the barns. It gets back to the conversations that have been here about the hay business, like how can my lowly quality cow hay become "premium horse hay" when the big boys get it? Why don't they have hay to honor your price agreements when they have it for everyone else at a higher price? Why are they almost out of hay when the barns are full and it's stacked all over the sides of the fields?

Seems that customer service and loyalty does not ring true with some "big boy" hay sellers. That's a great way to get led to the slaughterhouse.

 

[ArrowHBrand]

Hey boys and gals that's capitalism at work here in America and I wouldn't have it any other way. It's a simple case of supply and demand and that is what made America great!

Have you never heard you should always plan ahead for a rainy day, or the lack thereof?

We just bought 2,000 bales of corn and soybean stubble for $25. per to get through the winter and you don't see me crying a river.
I certainly hope you are not suggesting some sort of government regulation controlling the price of hay. Because if you are, after the price of hay is fixed, the price of cattle will be next.
Then you will really have something to cry about.
Ya know you are not the first people to face this problem and will not be the last, so learn deal with it!!
SL

Wow some people are just so galdarn... ! SL you obviously have no idea what America was built on! America wasn't built on screwing your neighbor, wasn't built on fixing or artificially inflating commodity prices, or watching producers around you cull heavy while you sit on tons and tons of hay waiting for spring when you can gouge the sh*t out of people. You make me sick and if you had told me this to my face I would have bloodied your nose! How blasphemous!
I expect to pay a LITTLE more for hay every year to match the rise of inflation. I would never pay 400% from one year to the next. I would find another supplier and then rub it in the other guys face. Our neighbors have been very good to us this year. We paid one $2/bale for grass if we baled it ourselves, which we did and we put up a few hundred bales. Another neighbor heard we were buying hay and he had some leftover from last year and we paid $1/bale for grass/alfalfa mix. My wife is the local county Fair Board Manager and their junior board member hooked us up with grass for $2.50 off the rack, and he delivered the rack to our place! We bought big rounds of grass from a new guy this year, he's on the Fair Board also, and he charged $90/ton, which I feel is a good deal.
I drive around and see all of this hay being put up and then am told of a "hay shortage". Give me a break, I think most of it is hay producers, not all producers, putting a bug in someone's year of a shortage and then it spreads like wildfire. I'm just talking about my part of the country, I'm sure in other places there are shortages and in some you can't give it away.

 

[ArrowHBrand]

This is what it all comes down to and I think only a few people and I are getting it. I expect and will pay more for hay every year, however, I won't be gouged and if I feel I'm being played the fool, I'll find another supplier. Inflating prices or "sitting on hay" is immoral and unethical and I wouldn't buy from someone who did it. With that being said, I woud also estimate my usage long and buy more than enough in the fall when prices are usually at their lowest.
You can sit and pencil out the numbers of buying vs. growing your own hay, but what most people don't pencil in is their time. How much is your time worth? I used to spend hours sickle cutting our hay, when the sickle broke down we paid a guy to winrow it. Now he cuts all of our hay because he can do it in a quarter of the time I used to and it frees me up to do other chores around the ranch. You can't say "they didn't really cost us $25/bale but really subtract the $18/bale for us to make our own" because you haven't figured in your time to fertilize, maybe spray herbicide, cut, check the cure, maybe have to rake, then bale. You also have to either move rounds or put up small squares. Add in time spend getting machinery ready, maintaining machinery, heaven forbid any downtime, and having the headache and worry of it all.
Growing and producing hay is a lot of work and they should be compensated for it fairly. How can someone look their customer, who is probably a neighbor, in the face when they tell them they marked their hay up 400% from last year or that their price is $200 more per ton than a local competitor. I know I couldn't, but I have a conscience.

 

[dieselbeef]

the sad reality of it seems to me...like last yr...is that anyone running short will have no choice cept to buy from the gougers..sitting on tons..because they will have it and if you need it what can you do?
last yr it didnt rain til june early july here. i bought hay til june. thats almost yr round..in florida!!?!?!? crazy..but i bought some god awful hay becasue i needed it. i paid too much for terrible feed but i had no choice. this yr i bought plenty ...but if it doesnt rain again i wont have enough...and if it rains ...then im stuck with 5 bales at 50 ea the cows wont eat cuz the grass is comin in so....it really sucks to be at the mercy of someone else for sure. no matter the price of making yer own at least you know if you have it and how much it costs

thanks jogee i didnt wanna be peeing on anyones head

 

[larryshoat]

I've read every post and decided you're all right.An old guy told me one time your either a son of a b@#&h or your not.You can use that template for hay dealers or anybody else.I charged the same price that I had been charging ,most people gave me more anyway,but hay is not a big part of my business.

Larry

 

[backhoeboogie]

Yea, I know this is not a new topic for me, can you really justify a 400% increase in one year?
Alan

There is over a 600% decrease here this year. Fertilizer cost more. Diesel (as you mentioned) cost more. Hay growers lost their tail. Are you contributing to their survival fund? There's going to be far less growing hay next year. Next time there is a shortage, it is going to be far worse and you'll cry even more.

 

[backhoeboogie]

BTW, most local suppliers in my area do not fertilize.

Alan

:lol: You get what you pay for.

 

[Alice]

Up until a few years ago, when there have been disasters/tragedies, impending or otherwise, gas stations around here immediately hiked their prices, sometimes 200%.

The city fined the honk outta them, finally. I don't remember exactly how the city went about it, but it caused one station to go under, which was fine by me. Those crooks that ran the station said they'd gotten "orders from headquarters" to do it. "Headquarters" started back peddling quick. Haven't seen it happen again.

Making an exorbitant amount money on others' misfortune just ain't right, dangit.

Alice

 

[3waycross]

Up until a few years ago, when there have been disasters/tragedies, impending or otherwise, gas stations around here immediately hiked their prices, sometimes 200%.

The city fined the honk outta them, finally. I don't remember exactly how the city went about it, but it caused one station to go under, which was fine by me. Those crooks that ran the station said they'd gotten "orders from headquarters" to do it. "Headquarters" started back peddling quick. Haven't seen it happen again.

Making an exorbitant amount money on others' misfortune just ain't right, dangit.

Alice

I agree totally!!!!!!!!!

However, if any of us had the last cheeseburger left in America I doubt it would be sold for $5.95

 

[Cabo]

Up until a few years ago, when there have been disasters/tragedies, impending or otherwise, gas stations around here immediately hiked their prices, sometimes 200%.

The city fined the honk outta them, finally. I don't remember exactly how the city went about it, but it caused one station to go under, which was fine by me. Those crooks that ran the station said they'd gotten "orders from headquarters" to do it. "Headquarters" started back peddling quick. Haven't seen it happen again.

Making an exorbitant amount money on others' misfortune just ain't right, dangit.

Alice

I agree totally!!!!!!!!!

However, if any of us had the last cheeseburger left in America I doubt it would be sold for $5.95

Also, would someone's decision to not bale their own hay fall into the misfortune colum? I have cows and sell hay when it is plentiful but don't worry about it either way since a customer told me to hold 125 rounds for him and it rotted. $8 a square is not unheard of around here. I fail to see where the seller or the customer owes the other anything but honoring an agreement.

 

[Dave]

Alan,
It is not really the hay guys and certainly not the beef producers who are driving up the price of hay. It is those thousands of horse owners who out number us now about 100 to 1. Last winter when there was a real shortage of hay they would pay anything for hay. The hay guys learned that they could get the high price so they left it there. Those horse people don't know much about the hay market and they aren't trying to raise animals for a profit so money is no object. I know several beef guys who are selling their hay to horse people a bale or two at a time. They are taking the money and turning around and buying eastside alfalfa by the truckload for less money. Better hay delivered to your door for less money, what a concept. The local grass hay is just not working for cattle this year and it may not for a number of years to come. You certainly don't want to be feeding small squares as it puts you into the same market as the horse peple.

And I don't think those guys are going to get stuck with their hay. Everyone I know who has hay for sale has been moving it. That is at $7 or $8 a bale.

Dave

 

[Sir Loin]

Hey guys no body know better then me that there is a fine line between dry humor and sarcasm and apparently I have crossed it again.
So no harm was meant. I was just trying to let you know if you don't dwell on people like those who are attempting to gouge you will be far better off.
I would never do business with them again either and I would also tell all my friends what I thought but that still doesn't change the fact that they have the right to do it and them and many more probably will.
What they are doing is just the price you have to pay in a free enterprise system.

All I was trying to say was thanks for the info, nice job turning your roadblock into a hurdle, that's what I would have done, now move on because in the cattle business the F you up fairy is planning her next roadblock for you.
SL

 

[Calman]

It has always been you try to sell your product for the most you can get out of it.
Most of us will hold our cattle to get the best prices.Just like a man holding his hay for the best prices.But there's always someone out there selling his product cheaper than another.
Those are the seller's I look for providing his product is good.
It's just hard to blame a man trying to make a living off of his product.But it's pretty hard not to get upset with someone you've bought hay from for several years, and all at once he raises the prices way out of hand. That's when you look around for a new supplier.
The way it's done around here anyhow.
You have the right to charge what ever you want for your product but that don't mean you are going to sell it.
I think your goal would be to try to keep your customers and try to make money while doing it.

Cal