Hay

Hay updates

Western drought deepens, pressures 2026 hay outlook.

As of May 4, approximately 46% of U.S. alfalfa hay acreage was experiencing drought conditions, underscoring persistent moisture deficits across key growing regions. These conditions are particularly evident in the West, where below-normal snowpack, warmer-than-average winter temperatures and limited spring precipitation continue to raise concerns about irrigation availability and forage production throughout the growing season.

U.S. hay export volumes declined in the first quarter of 2026, reflecting ongoing adjustments in global demand and logistics. National export volumes fell 7.9% year over year, though stronger prices limited the decline in export value to 4.7%. The outbreak of conflict in the Middle East further disrupted shipping, forcing hay to be rerouted or transloaded and driving up logistics costs. As a result, March shipments to the region plunged 52.3% from a year earlier. March’s export volumes to Saudi Arabia fell 45.5% month over month and shipments to the United Arab Emirates were down 23.9% from the previous month.

Regional trends varied, however, with some export channels showing signs of recovery. Exports through the Seattle and Columbia–Snake River terminals increased 5.3% compared to the first quarter of 2025, suggesting that exporters in the Pacific Northwest are beginning to right-size operations and regain market footing. In contrast, shipments through Southern California ports remained under pressure, with volumes down 25.4% year over year, reflecting ongoing pressure from weaker demand (this region is the primary hay exporter to the Middle East) and higher costs.

Hay prices have edged slightly higher across the West, supported by solid demand amid drought concerns. Alfalfa prices improved during the first quarter, but rising fuel costs are adding pressure across the hay supply chain. In Washington’s Kittitas County, diesel prices averaged $6.82 per gallon as of May 3 (a 60% year-over -ear increase) raising costs for fieldwork, transportation, and custom services. As a result, many operators have added fuel surcharges, increasing delivered hay costs for livestock producers and end users.

Conditions by state:

Arizona

Drought remains a dominant concern in Arizona, with 78% of pasture and range rated in poor or very poor condition as of May 4. Roughly 75% of the state’s cattle inventory is currently impacted by moderate or greater drought conditions. Alfalfa prices have strengthened in Arizona, with all grades averaging roughly $15 per ton higher year-to-date, supported by strong retail demand. Quality challenges in new‑crop hay have weighed on export demand, which has been further pressured by disruptions in the Middle East (a key export destination).

California

Weather challenges continue to shape California hay markets. In Northern California, persistent rainfall has delayed fieldwork and harvests, while wet conditions in the Central Valley have delayed cuttings, weighing on feed quality. In contrast, first cutting in the Imperial Valley began nearly a month early due to the dry winter. However, demand for the new crop has been stable with high-quality hay prices approximately $10 per ton higher than a year ago.

Idaho

Hay demand in Idaho remains steady, with most existing inventories largely sold out. Concerns surrounding drought and reduced irrigation allocations are beginning to intensify following the governor’s statewide drought emergency declaration. These conditions have increased early‑season interest from cattle producers looking to secure forage. Idaho hay prices have risen notably, with USDA reporting average hay prices up $15 per ton year over year in March and lower‑quality hay gaining $20 to $30 per ton. Tight remaining hay stocks and a rapidly expanding dairy herd continue to support prices.

Montana

Dry conditions continue to impact Montana’s forage outlook, with nearly half of the state’s pastureland rated in poor to very poor condition as of late April. As drought conditions intensify, available hay supplies have tightened, leading to improved demand and rising prices. While some areas received scattered precipitation in April, much of the state’s cattle inventory remains in drought-affected regions. Ranchers are increasingly concerned about summer grazing conditions and may need to rely more heavily on supplemental feeding. USDA data indicates average hay prices have reached $157 per ton in March, up 12.9% year over year.

Oregon

In southern Oregon, particularly in the Klamath Basin, ongoing dry conditions are beginning to influence acreage decisions. The Drought Response Agency is offering between $250 and $300 per acre for land idling, creating a financial incentive for producers to reduce planted acreage. As a result, total hay and grain production in the region is expected to decline, which could further tighten supply and support prices later in the season.

Washington

First cutting is underway in the Columbia Basin, with early reports indicating generally stable prices. However, demand signals are mixed. Export activity has been relatively slow, and dairy demand has softened compared to earlier periods. Feedlots are showing interest in purchasing hay, but primarily at lower price points, suggesting some price sensitivity remains in the market.

Profitability

Alfalfa hay markets are expected to operate near breakeven in 2026, as relatively stable but low prices are magnified by high production costs and continued softness in export demand.

Timothy hay markets are expected to operate near breakeven in 2026, as steady but limited demand is offset by elevated production expenses.