Hay shortage leaves Texas ranchers scrambling for cattle feed


Highlights

Lack of rain has sent hay prices rising.

Faced with extra feed expenses, some Texas ranchers are looking at culling their herds.

In a good year, the Lazy Two Cattle Company already would have harvested about 1,200 bales of hay by now, the beginning of a stockpile to get its cows, bulls and yearlings through the winter when forage is scarce.

This isn’t a good year.

“We could have a wreck on our hands,” said Larry Mellenbruch, co-owner of the ranch, which is about midway between Austin and Bastrop. “We’ll be trying to buy hay — if there is any out there to buy.”

The Lazy Two, which normally grows its own hay, has been able to harvest only about half as much as normal this summer from its fields near the Colorado River. That’s a trend that has been unfolding across the state as high temperatures and drought conditions in many areas have dried up crops and left ranchers scrambling.

Prices for hay — the primary cattle feed in the winter — have been climbing as a result, with large round bales averaging $55 in Central Texas as of early August, up about 22 percent from $45 a year ago, according to the most recent figures available from the U.S. Department of Agriculture. Prices are expected to keep rising because the growing season ends in a few weeks, and Texas A&M University’s AgriLife Extension Service already has received reports of bales selling for up to $125 west of Austin.

“There is a fair amount of worry about where this is going, and the prices are reflecting the tight supplies,” said David Anderson, a Texas A&M agricultural economist.

Ranchers don’t have many good winter feed options for their cattle other than hay. They can default to lower-quality roughage, such as baled corn stalks, and then augment the diet with additional commercial supplements — but in most cases it’s more cost-effective simply to cull herds.

During the historic drought from 2010 through 2014, Texas ranchers culled about 1.2 million beef cows from the state’s overall herd, bringing the total to about 3.9 million in the aftermath. The number of Texas beef cows has been on the rise since then — beginning 2018 at about 4.6 million — but ranchers once again are facing tough choices.

“When it becomes just too expensive to buy enough feed to keep your cows, you are forced to sell them off,” Anderson said. “It’s at the point where it is forcing decisions by ranchers to go ahead and get rid of cows now.”

Still, he and others in the industry said the predicament isn’t nearly as dire as it was at the height of the previous drought. “It’s serious and it’s forcing some decisions — but it’s not like 2011 yet.” Anderson said.

The emerging hay shortage is being reflected at cattle auctions across the state, however, because many ranchers have opted to begin culling herds all at once. Beef cows culled from herds in Texas were averaging $55.75 per 100 pounds in early August, according to the Agriculture Department, down about 25 percent from $74 a year ago.

Meanwhile, prices for many cuts of beef already have been slipping nationwide, fueled primarily by high U.S. beef production overall. Average U.S. retail prices for various types of ground beef have declined by about 10 percent over the past year, for instance, according to federal statistics.

Michael Cotton, who has about 30 cows at a ranch outside La Grange, got a first-hand taste of the weak market recently when he sold two of his cows and a calf at the weekly Hills Prairie Livestock Auction outside Bastrop.

“I knew (prices) were going to be low,” Cotton said, glancing down at his check totaling about $1,800 combined. But “this is pathetic.”

He said he plans to hold off culling any more of his cattle for now because of the low prices, opting to avoid the glut coming to market and bet instead that weather conditions will improve and help alleviate the situation. “Hopefully, we’ll get some rain, and we’ll go from there,” he said.

According to the U.S. Drought Monitor, about 26 percent of Texas is in severe drought and about 19 percent is in extreme drought. Although Central Texas and some other areas of the state recently received some rain, experts said it will take more than a few showers to mitigate the dry conditions in time to substantially increase winter hay supplies before the growing season ends in September.

“I think (hay prices) are going to keep going up until we see some rain — and a good rain, not a quick wash,” said Patrick Dudley, coordinator for agriculture commodity boards and producer relations at the Texas Department of Agriculture. Prices for hay “are going to steadily climb” until that happens.

Texas A&M’s Anderson said a number of factors have exacerbated the hay shortage this year, including low stockpiles to begin with and dry conditions through much of the summer that prompted some ranchers to begin using hay early as a supplement to make up for a lack of fresh forage for their cattle.

Hay stockpiles in Texas totaled an estimated 1.2 million tons as of May 1, Anderson said, compared with about 3.3 million tons on the same date a year ago. Hurricane Harvey last year took a major toll on hay inventories in some parts of the state, he said, while a relatively cold winter increased the amount of hay that cattle required.

Mellenbruch of the Lazy Two Cattle Company said he still expects to harvest an additional 550 or so bales before the 2018 growing season ends. At this point in a normal year, however, he has the equivalent of about 1,000 bales of hay remaining to be harvested.

“There’s definitely going to be a shortage,” Mellenbruch said.

The Lazy Two is planning to cull about 100 of its 400 cows this year to reduce its hay needs over the winter, compared with a typical cull of about 40 cows. But even the planned 25 percent reduction might not be deep enough, Mellenbruch said.

He has other options, such as planting winter oats to increase the amount of time his cattle can forage without relying solely on his hay stockpiles. Just like growing hay, however, that plan relies on rain.

“If we don’t get any rain, it’s going to be pretty tough,” Mellenbruch said. “We’re going to be hurting, just like everybody else.”



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