By CRAIG FREILICH
North Country cattle farmers could be squeezed hard financially this winter because severe drought in some parts of the country is likely to send grain prices way up.
The rise in grain prices expected later this year is good if you have corn or soybeans to sell, but not so good if you’re forced to buy.
It has not been a great year for growing hay and other crops that St. Lawrence County dairy farmers need. Good hay cuts have been scarce since the first early cut, according to local crop watchers.
The local corn crop, however, seems to be coming in with decent if not outstanding yields. But farmers who must buy feed for their cattle are almost certain to face higher prices later this year, experts say.
High Cost For Protein
There has been a big jump in cost for feed crops with high protein content such as soybeans, according to Ellie Stripp, manager at wholesale feed dealer Wight and Patterson in Canton.
“The big impact so far is in the cost of protein,” Stripp said. That means mainly soybeans, which are typically 47 percent protein. “We’re paying 45 percent more for protein than we did a year ago,” in spite of the recent price drops on commodities markets.
Protein is the most important component of feed for animals such as dairy and beef cattle, Stripp said. Part of her job is making sure the component ratios are right based on what the customer needs.
“We can use other protein sources, but all those have gone up accordingly,” Stripp said.
When the soy price rises, the price of “middle protein” sources such as distiller’s grain and gluten, not as rich as soybeans, are dragged up along with soybean prices.
“It means that the price of the finished feed is that much higher,” she said.
Corn Prices Down
The price of commodity corn has come down in recent weeks in part because this year’s crop is starting to come in, and also because of a drop in exports when prices got so high earlier this year.
In the North Country, “Overall, people are saying ears of corn seem not as large as they could have been,” said Brent Buchanan of Cornell Cooperative Extension of St. Lawrence County.
But “corn’s great. It looks good. The yield is down a little bit” locally this year, said Stripp.
“Some farmers saw the writing on the wall and used shorter-day corn. The ears are not as large anyway,” but they stood a better chance of maturing properly than longer-season corn, Buchanan said.
Most corn in St. Lawrence County is cut for silage, Buchanan said, “especially this year with poor forage” due to the dry weather, “and it has lots of inherent value – too valuable to leave in the ground” even if the ears aren’t as large as what the grower wanted to see.
Stripp says that at the moment, the Canton feed supply business is actually paying less for corn than at this time last year.
“But I see them going up again pretty significantly. It’s going to happen sooner or later,” said Buchanan.
Analysts at Reuters news service have said that supplies will tighten later in the year and have an effect on price.
“My brokers are telling me corn will be very hard to get in late winter,” Stripp said. “Local corn, oats and barley won’t get us through the entire year. It could get challenging to find them in late winter and early spring.”
Those higher prices and the shortage of hay could result in early culling of relatively unproductive cows that are not producing milk as fast as they had been, according to Buchanan.
While farmers can usually count on three and maybe even four hay cuts a season, dairy farmers here are likely to be short of hay this year because of a lack of rain after the first spring cut, so they might have to shell out money to buy more.
If expenses are too high and the milk price is too low, farmers may cull more cattle than usual and sell them off for beef.
Oats, Corn More Abundant
Other feed components are more abundant locally than last year, Stripp said.
“Last year there were practically no oats, and this year there is good supply and it’s good quality. And barley – you couldn’t find it last year, and this year there’s a pretty good supply.”
Stripp said they buy as much as they can from nearby growers– “it feels good to buy local when we can” – and it is bound to be less expensive than having it hauled in from hundreds of miles away.
Much of Wight and Patterson’s corn supply has for decades come from growers in Central and Western New York, but ethanol production has taken much of that away from the feed market.
“We’re competing with ethanol plants for product,” Stripp said. “They say now it’s just easier to go to the ethanol plants in Fulton and Western New York. They can dump and go,” rather than haul it north and make deliveries, “and that’s understandable, but it hurts our ability to purchase from Central New York.”