Expensive Fertilizer and The Cost of Making Hay

As the fertilizer bills are coming in, many of us are suffering from sticker shock. Not too long ago it would have been a stretch to imagine $650 urea, $1,200 MAP and $600 muriate of potash. Livestock producers producing their own forage and using manure to manage their fertility will be much less impacted than those cash cropping grain and hay. How will high commercial fertilizer costs and increased commodity and land prices affect forage production?

P and K Removal

Forage crops have high nutrient requirements. With a mixed alfalfa-grass stand, the value of the phosphorous and potassium removed is currently about 2.1¢/lb (or $46/tonne) of dry hay harvested. Grasses contain a little less P and K, so about 1.8¢/lb ($40/tonne) are removed. As an example, assuming a mixed stand with a modest yield of 3.2 tonnes (3.5 tons) per year, hay will remove about 57 lbs of P₂0₅ and 206 lbs of K₂O, with a value of $147/acre (assuming P₂0₅ @ $1.05/lb and K₂0 @ $0.46/lb).

Without manure or commercial fertilizer, the soil test will drop quickly. Assuming that it takes about 35 lbs/ac of P₂0₅ and 20 lbs/ac of K₂0 to move the soil tests by 1 ppm on some soils, after only 4 years the P₂0₅ soil test could drop by 7 ppm and the K₂0 by 41 ppm. This is commonly referred to as “soil mining”, and is not sustainable.

With the increase in fertilizer prices, you may question whether you can afford this expense, but the short and long term costs of poor fertility is much higher than the cost of the fertilizer.

Impacts On Pricing Standing Hay

Historically, standing hay has often been a good buy. With higher corn, soybean and wheat prices, we are seeing higher hay prices in the market. Land rental rates have increased, and there is competition for acreage from these other crops. If you consider an opportunity cost for land rental, P and K removal, and an amortized establishment cost, that historic 1 - 2¢/ lb of standing hay is way under the mark today.

For example, as a starting point for negotiations, what would be a possible value for a field of standing hay yielding 3.2 tonne/ac (3.5 ton/ac), that could rent as bare land for $175/ac? This pencils out to about 2.1¢ for P and K removal, plus 2.5¢/ lb land rental, plus about 0.7¢/lb in amortized establishment costs, for a total of about 5.3¢/lb. Even an old grassy field yielding only 2.5 tonnes/ac (2.75 tons/ac) grown on land that might rent for $50/ac, without any amortized establishment costs (because it is so old), might be worth about 2.7¢/lb (1.8¢ P and K removal plus 0.9¢/lb land rental value).

Livestock still needs to be fed. Will, and more importantly, can the market pay these kinds of prices? I don’t know, but if it doesn’t there may be a lot of hay acres move to other crops.

N Value of Alfalfa Plowdown

When penciling the value of growing the various crops, don’t forget to consider the nitrogen value when alfalfa is plowed down. A stand that is one-half or more legume contributes about 110 kg N/ha (100 lb/ac). At current nitrogen values, this is equivalent to about $63/ac. Stands that are only one-third to one-half legume get a N credit of about 55 kg/ha (49 lb/ac), for a value of $31. Research also shows that in addition to the nitrogen credit, there is a yield benefit of alfalfa plowdown to corn of about 10 - 15%.

Soil Sample

With higher fertilizer prices, you may want to target your fertilizer applications more strategically than in the past. Take soil samples after first-cut to guide fertilizer applications later in the summer. If the K soil test of the field is below 150 ppm, you can expect a response to adding potassium. In addition, low P and K fertility will reduce the longevity of the stand substantially. Consider top-dressing fields with commercial fertilizer or manure following one of the cuts during the summer.

Manure Getting More Respect

As fertilizer prices keep going up, manure is getting more and more respect! Maintaining fertility is much easier and less expensive for forage producers when manure is available. The best option because of the highest economic return from the nitrogen is still to spring apply manure to corn crops in the rotation. However, there are some advantages to applying manure to forage, including potential yield benefits, spreading the workload, reducing manure storage requirements, preventing soil compaction, and reducing environmental risk.

Higher hay, land and input costs means we need to do the best we can in growing, harvesting and storing our forage crops to maximize yield and quality, and minimize losses. Refer to “Pricing Standing Hay” and “Manure Application To Forages - An Economical Alternative” on the OMAFRA Forage Website.

Related Links:

• OMAFRA Forage Website

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