Forage’s fortunes never looked brighter, conference hears

Everybody, it seems, wants forage and that had speakers at the recent Canadian Forage and Grasslands Association conference in Saskatoon questioning why it’s still an afterthought on many Prairie farms.

“That’s one of the problems with our industry. We don’t recognize the importance of forage,” said Ed Shaw, owner of Alberta-based International Quality Forages, and past president of the Canadian Forage Grasslands Association.“We don’t count it. Nobody thinks it’s important, but without forage, you’ve got nothing.”

Apart from Statistics Canada, there are no comprehensive annual production statistics for forage crops in Canada, even though at over 67 million acres, it exceeds wheat and canola and is the foundation of the nation’s beef and dairy sector.

But the days of it being a poor second cousin to annual crops could be coming to an end.  “I see great opportunities for forage producers in the years to come. I don’t see why that would ever change,” said Rollie Bernth, president of the United States National Hay Association, at the recent Canadian Forage and Grasslands Association’s annual general meeting.

Water shortages and a loss of arable acres due to urbanization is forcing livestock producers in many countries to look further field. Middle East countries, leery of dwindling acquifers, are cutting back on irrigation, which is increasing their demand for imports.

Even a huge country like China, for example, has problems meeting demand, in part because the Chinese authorities are diverting precious water away from agriculture to serve more lucrative municipal uses, even as livestock and dairy production grows.

Alfalfa hay is worth over $420 per tonne once it reaches the port at Shanghai, Shaw said.  Shaw, a long-time exporter of forage to the Middle East and Asia, has seen the problems there first hand. Confounded by the costly logistical and regulatory problems of shipping forage to China from Canada, he once toured the country to see if it might be feasible to contract production locally.

Where water is available, the farmers are more interested in growing crops with higher returns per acre. In the areas where there is enough space to grow relatively low-value forage crops, poor road and rail infrastructure mean that it is actually cheaper to import hay from other countries.

In northern China, where desert-like conditions prevail, many of the surface aquifers are saline, and can’t be used, he added. “There’s going to be a new world currency – water,” said Shaw.

Bernth said it will take at least a year for forage production in Texas and Oklahoma to recover from a devastating drought. Also, in the Columbia basin on the west coast, farmers are switching from forage to high -value crops like corn and wheat.

“I’m really concerned about future supplies of hay for the world. I don’t know where its all going to come from,” said Bernth.

Canada, with millions of acres of forage and grazing lands with sufficient rainfall to support forage production, is poised to profit — if it can afford the freight.

Ying Liu, one of 50 shareholders in MaxCrop Landing, a Chinese company with large real estate holdings in Canada, said her company has bought over 60 quarters of land in the Yorkton area.

The land has temporarily been rented back to the sellers, but the company currently buying machinery and plans to hire a farm manager next year with an eye on growing wheat and beans, with alfalfa as a rotation crop.

“We are thinking of setting up a hay plant, but the freight is really a big concern,” said Liu. “But the demand in China for alfalfa hay is really high.”

Aaron Ivey, president of the Saskatchewan Forage Council, said that Canada’s beef industry, which currently eats up about 80 per cent of annual production, is going to start using more forage, too. With the cost of corn in recent years rising from $2 to $6 per bushel, feedlots are going to look for ways to cut costs.

Where traditionally calves spent 200 days in the feedlot on a high-energy ration, the higher costs of that production system might see that period slashed to just 100 days, with the balance swinging in favour of forage-based backgrounding.

“As the cost of a pound of gain in the feedlot goes up, then the value of gains on forages is also worth more,” he said.