Making money with hay

[pbnewbie]

Hi all,

This thread has been really good for me. I'm learning a lot.

I'm seriously considering investing money in refurbishing my hay meadow. It's about 80 acres. The local agent says it needs to be reseeded and the government can help with that. I don't know all the specifics yet, but one thing he said to me stuck out. He said that in any given year when there is rain, everybody has hay. So, how do you guys make money selling hay in a year when everyone has hay? Or do you make money that year? This ranch was my husband's love, but for me it has to be a business because it's such hard work! I don't want to be investing money in a losing money proposition. This year, the baler will bale it for $22 a roll. I was thinking that if I sold it for $45-50 a roll, that wouldn't be a bad deal for me. However, some people are trying to tell me that you can't get that even for medium quality hay this year because "everybody has hay this year"....

Whatta ya think?

pbnewbie

 

[Brandonm2]

Hay USUALLY does not sell that high.....this year is one that is NOT going to be usual (unless things change quick).

 

[msscamp]

This year, the baler will bale it for $22 a roll. I was thinking that if I sold it for $45-50 a roll, that wouldn't be a bad deal for me. However, some people are trying to tell me that you can't get that even for medium quality hay this year because "everybody has hay this year"....

Whatta ya think?

pbnewbie

I think it is not about you - it is about what the market will bear. Simple laws of supply and demand dictate that you're not going to sell your hay for $45-50/bale if the neighbors are selling comparable hay for $30/bale. If "everybody has hay this year" proves to be true, then that cuts your market by even more because people can shop around for the best price and quality. People also tend to stay with 'tried and true', which means established reputation for the quality of hay, and how one deals with people. You're a newcomer and have not had the opportunity to establish either. The mere fact that you're hiring a custom cutter(and probably a stacker, as well) to do your baling is probably going to price you out of a lot of markets because you will have to price your hay higher to cover the costs, whereas the person who does his/her own cutting, baling, and stacking does not have the added expense. I believe I would do a whole lot of research, and rethink my options for this particular piece of ground.

 

[BTRANCH]

I called today on a 4 x 5 round bale at about 1,000 lbs and was told $65.00 per bale.

If you bale your hay, $45-50 is a FAIR price for good quality hay. Where in Texas are you? I would glady pay that price for 50 bales.

There are too many people trying to make a quick buck from the drought here in Texas. We hauled hay last summer from Arkansas and Louisiana to avoid paying $100.00 per bale.

 

[pbnewbie]

If you bale your hay, $45-50 is a FAIR price for good quality hay. Where in Texas are you? I would glady pay that price for 50 bales.

About 75 miles north of you.

I don't think that reputation is going to be an issue. We've been here for a long time and people knew and loved my husband. I'm just trying to figure out the best way to handle this ranch on my own. Even my husband had the hay baled and didn't bale it himself. He just didn't sell it because we used it for cattle. I'm not sure how much cattle I want to run. It seems easier to grow hay.

 

[vs_cattle]

Good luck in you works on the ranch and maybe run a few head of cattle to get a feel for it again and freezer beef

 

[pbnewbie]

Thanks

 

[Saltydawg]

Glad I'm not in Texas.

I buy 4x5 round bales, delivered, for 24.00 each here

 

[BTRANCH]

Keep me posted if you decide to sell any round bales. I would be happy to help you continue your tradition of hay cutting.

I will be glad when we get to the point of having a good reputation and farm traditions. Everything is so new to us right now.

 

[pbnewbie]

It's new to me, too, but it wasn't to my husband. Some details you just don't talk about, and then.....it's gone.

 

[dcara]

If your going to hire a custom baler I suggest you learn as much as you can about when to cut the specific forage, and when to bale (i.e. what moisture level to bale for squares or rounds). Some custom balers want to just get the job done as quick as possible so they can move on. When their equipment is not running they are not making any money, and they don't like hauling eqipment between job sites. So they may bale the hay before it has dried enough and hence has to much moisture. Then your left with bales that may mold, incur internal heat damage or worse within just a few weeks. Now you'll be trying to sell low quality hay in a competative market (good luck with that), or people that you've sold hay to calling you tell you your hay carp. In short, know what your getting into.

 

[johndeereboy]

Just a thought if everyone planted corn this year, wont hay be expensive???

Up here in Wisconsin we are getting 55.00 a bale. All we do is move it off the field and it does not go in a shed.

 

[hurleyjd]

It's new to me, too, but it wasn't to my husband. Some details you just don't talk about, and then.....it's gone.

Sounds as if you might be a widow. I do not know the price of land in your area, but it might be time to sell it and put it in the bank. $3000 per acre land will have to generate at least $150 per acre to do as well as the money on the CD. That way there is no property tax and you can get the check each month in the mailbox. There will be no rain to worry with, you will not have to look for any buyers and all the headaches that go along with producing hay. Just be careful there are a lot of slick shyster men out there that are willing take a widow to the cleaners. When she is broke they move on to the next one. I have seen it happen.

 

[Stocker Steve]

Hi all,

So, how do you guys make money selling hay in a year when everyone has hay?

Whatta ya think? pbnewbie

Hay farmers in my area do not usually make money. There are too many semi retired guys who like to drive tractor and are willing to sell hay for $30 to $60 a ton. The only exception may be someone who has great stands and can make dairy quality alfalfa.

I have three guys in their 60's who sold hay to me this year.
1) One priced 4x5s for $20 and he was out right away.
2) One priced big 5x6s for $20 and he was out right away.
3) One tries to sell 4x5s for $27 and he still has 2005 hay in the shed. It is a little better hay but the cow/calf guys won't pay that much and it has too much grass in it for the dairy guys.

Buy a border collie and some cattle and let someone else drive the baler.

 

[Brute 23]

I believe investing in Ranching and Farming is just like investing in anything else..... DIVERSIFY. Any time you put all your investment into on thing... such as hay... you leave your self open for a big fall.

Not saying you can't make a little money on the side selling hay... but I don't know that I would go investing a bunch of money expecting to get it back any time soon.

 

[Earl Thigpen]

In my day job I worked with a fellow who decided to bale and sell hay. Of course when he decided to do this it was during a really bad drought and hay was selling for $65-$70/roll. I advised him against it for the very reasons stated here - when everyone has hay you're not going to sell yours for $25-$30/roll higher than everyone else. And when no one has hay, neither will you.

He didn't listen and spent $50K on equipment (he already owned a tractor) but was out of business within two years because it started raining.

Then there are stubborn old farts like me who absolutely refuse to pay gougers prices of $90 to $100/bale. (please don't start on this - we've been down this road before. This statement is my own opinion)

And as far as owning your own equipment even that is risky. The only reasons I can see to buying your own hay equipment is 1) your going to become a custom baler or 2) you need to bale hay when YOU need to bale, not when the custom baler has time to do it.

Good luck to you and have a safe weekend.

 

[pbnewbie]

Wow. thanks for all the answers.

Yes, I'm a widow. Married the best guy in all of creation. So, I'm going to stay on our place and try to retire here. Just trying to figure out the right direction.

 

[hurleyjd]

Wow. thanks for all the answers.

Yes, I'm a widow. Married the best guy in all of creation. So, I'm going to stay on our place and try to retire here. Just trying to figure out the right direction.

Several years ago when my father could not take care of his place, we let a custom baler take it and give so much a bale. I was working at the time and did not have cows on my place so I made the same deal with them for my hay. They started paying $6.00 a bale. I did not do anything. The last year when hay was more scarce, I asked to increase the price to $10 and they agrreed. These guys had a lot of customers all over the place and had a place to go with it as soon as it was baled. If it is really good hay then you can maybe make a deal with someone along these lines. You cannot buy fertilizer and come out on this deal. The hay that we were selling came from farms that had been operated as dairys for about 25 years. Grass grew pretty good on these places.

 

[pbnewbie]

good idea!