FROST damage and moisture stress in crops in parts of the Mallee, Upper South East and Mid North has forced some farmers to literally cut their losses and bale wheat crops for hay rather than reap for grain.
Frost damage has been reported from Karoonda through to Coomandook, with some small sections around Keith also suffering.
With the price for wheaten hay sitting between $140 a tonne and $200/t, depending on quality, some farmers are seizing the opportunity to at least cover the cost of putting seed in the ground, rather than reaping it and receiving a poor return at the silo.
Adding to the decent price for wheaten hay is the fact that oaten hay yields are reported to be 15 per cent to 25pc down on last year, meaning a number of exporters are looking for wheaten hay to fill the gap.
Tailem Bend-based hay merchant Guy Lithgow, Lithgow Enterprises, said his company was buying limited amounts of frosted wheat. Balco Australia had also bought frosted wheat.
"The price people get will depend on the feed test and that will depend on how soon after the frost the crop has been cut down," he said.
"If they left it too long after the frost they are going to suffer a little bit in pricing."
Mr Lithgow said he had heard of some farmers cutting up to 1000 hectares damaged by frost, while others had cut 150-200ha.
He said while companies were always on the look out for good oaten hay – up $15-$20/t on last year – they were also looking to fill export orders with wheaten hay, reflecting the price.
"There is still a preference out there in the export market for oaten hay but the wheaten hay will fill that gap in the overseas market," he said.
Balco Australia general manager Rob Lawson said the company was looking to buy up to 10,000t of wheaten hay but there was potential to go up to 20,000t.
He said they were sourcing most of the wheaten hay from the Mid North and Mallee.
"We would normally have a solid market for up to 5000t of wheaten hay, but this year we could buy up to 20,000t," he said.
"That is largely on the back of yields being down for oaten hay and the fact there is good demand for fodder in our global markets."
Mr Lawson said he expected the majority of exports to go to Japan, Korea and Taiwan.
*Full report in Stock Journal, November 1 issue, 2012.
