Drought reduces hay production, to pressure prices
Alan List is no stranger to farming through a drought.
List Ranch in Lovelock persevered through drought conditions in the early 1990s, and the hard-won experienced gained during that difficult time will help List and other northeastern Nevada alfalfa growers survive what’s shaping up to be one of the worst drought years in decades.
Alfalfa growers in Lovelock and the Smith and Mason valleys in Lyon County are looking at a difficult year due to lack of water for the second consecutive year. Hay growers in those areas — who primarily rely on streams and rivers rather than wells for irrigation — are expected to get as few as two cuttings of alfalfa this year instead of the typical four cuttings.
List says his normal water allotment is three acre-feet, but this year it’s a meager one-quarter acre foot. List irrigated what he could of his typical 500 acres of alfalfa and a scattering of grain and field crops, and he’s already used his water allotment for 2013.
“We are done irrigating for the year. What we irrigated we will get two cuttings off of, and the stuff we didn’t irrigate on we will get one very, very light cutting,” he says.
Water-year precipitation in many parts of the state is in the 70- to 85-percent of normal range, but remaining mountain snowpack is about 30 percent of normal or less in the majority of principal watersheds, the National Agricultural Statistical Service reports. Reservoir storage, already down from last year, is dwindling, and stream flows are declining throughout the northeastern half of the state.
The lack of available water means a sharp decrease in tonnage of Nevada-grown hay — prized by horsemen and dairymen in Nevada and California for its high protein content. Statewide, Nevada alfalfa growers produce 4.5 tons per acre, says Marty Owens, statistician for the USDA National Agricultural Statistical Service Nevada Field Office. In 2011, Nevada farmers grew 1.1 million tons of alfalfa at a value of $232 million, the NASS reports.
Production decreases could cause a sharp upward swing in prices. Alfalfa prices in the first quarter hovered around $200 a ton, a roughly 12-percent decrease from the same period in 2012. Current prices are markedly different from the low of $93 a ton received during May of 2010, however.
“We anticipate a very tight market and great demand for alfalfa hay, Owens says. “There is widespread concern over surface water supplies, and growers are making some tough decisions on what crops to irrigate and which ones to just give up on to make what little water they have stay.”
Fallon-area farmers are expected to be impacted as well, but to a lesser degree, says Owens, because many draw their water from the Carson River. A lack of water means the growing season will be cut short for farmers who primarily rely on surface water for irrigation. Farmers with wells to irrigate their crops can expect attractive prices for their hay — albeit at higher production costs due to increased pumping costs.
An upward trend in hay prices also could negatively impact plans by Fallon dairymen to increase their herd sizes to meet capacity of the new Dairy Farmers of America dry milk plant scheduled to open this fall.
“We have not yet seen a great influx of dairy cattle to provide milk for that, but we certainly anticipate them coming,” Owens says. “We are looking at drought conditions across much of the grazing county. We are looking at some curtailments of grazing due to the fires we had last year, with short range and low forage production.”
List, who farms his land with his son, Jim, says most growers in the Lovelock area will let their hay grow a little longer and sacrifice quality for quantity. List concentrated his irrigation efforts on newer stands of hay and ignored some of his older stands.
“It will either live or die; we will know at the end of the year,” he says.
List expects to harvest roughly one-half to one-third of his normal acreage in 2013. A single bad year also affects alfalfa farmers for several years to come. Acreage that farmers don’t irrigate usually dies off and has to be replaced, which adds capital expense in future years.
Alfalfa growers will be pinching pennies between now and the next bountiful water year, List says.
“You just try to spend as little as can and maximize production. There are a lot of costs that go on, insurance and wages and those things. You can cut some, like fuel and fertilizer. We will just hunker down. We went through this in 1991, and you expect this every once in a while — it is just part of farming. You just live with it and hope for better year next year.”
The rate effective Jan. 1, 2020, is 1.65 percent of wages paid to employees. That is two-tenths of a percent lower than the current rate, giving a significant break to businesses that pay the tax.