With three major foreign markets setting highs for the year, August 2016 U.S. alfalfa hay exports volume grew to a new high, according to USDA’s Foreign Agricultural Service monthly data.
August exports totaled nearly 250,000 metric tons (MT) for the first time ever (Table 1). Exports have now topped 200,000 MT for four consecutive months.
Alfalfa hay exports to China, Japan and Saudi Arabia were substantially higher, pushing the monthly world total to 247,888 MT (Table 2). Despite lower prices, the jump in volume pushed the value of August alfalfa hay exports to nearly $74.7 million, the highest total of the year.
At 120,015 MT, August exports of other hay continued a small increase for a second straight month. Exports of alfalfa cubes and meal also improved slightly.
Clouds, which began forming over the hay export market in September, were not yet reflected in August numbers. However, the clouds remain.
The bankruptcy of Hanjin, the world’s seventh-largest shipping company, caused shipping delays and last-minute changes to other vessels, resulting in overbooking and further delays, according to Christy Mastin, international sales manager with Eckenberg Farms Inc., Mattawa, Washington. The South Korean company handled around 8 percent of West Coast trade, including agricultural products.
Mastin said China’s August and September purchases may be elevated to account for a week-long holiday – Golden Week – during early October, when shipments aren’t normally scheduled to arrive. There continues to be reports China has developed hay stockpiles, which could result in reduced sales later this year.
Export totals to Saudi Arabia, which purchased large amounts of acreage in the southwest U.S., are bolstered by its own production sent home.
Japanese livestock managers’ ability to switch forages in livestock rations gives them flexibility when prices are attractive, and it appears more are moving from other hay to alfalfa. However, the number of cattle is declining, and forage needs are expected to decline year over year.
The western U.S. alfalfa crop quality has been good overall. Australia is getting hit with rain during their oaten hay harvest season. With rain negatively impacting Washington, Oregon and Canadian timothy harvest, U.S. alfalfa could help fill a void.
U.S. ag trade balance gaining strength
The hay exports helped the U.S. agricultural trade balance continue to gain strength in August.
Monthly ag exports were valued at $11.25 billion, the highest since November 2015; imports were $9.42 billion, resulting in a trade surplus of about $1.84 billion, the strongest since December 2015.
Fiscal year 2016 year-to-date (October 2015-August 2016) exports are estimated at $118.61 billion, compar