Acreage too wet to plant on time for most insured crops is again prevalent in North Dakota and Minnesota. An alternative some producers may want to consider is to not request a prevented- planting payment and instead seed a warm-season grass for hay later in June when the land dries enough to plant.
“The net income from the hay may be as much or more than the prevented-planting payment, less the cost of putting a cover crop on prevent-planted acres,” says Dwight Aakre, North Dakota State University Extension Service farm management specialist. “With an actual production yield of 38 bushels per acre for spring wheat and a 75 percent insurance coverage level, the prevented-planting payment would be about $111 per acre. Land preparation and seed for a cover crop would cost about $28 per acre, leaving a net of $83 per acre.”
Planting a warm-season grass, such as German millet, could yield about 3 tons per acre, with seed, land preparation and harvest costs of $85 per acre. At $56 per ton, this hay would generate the same net return as a prevented-planting payment.
Cattle producers are realizing record high prices and herd expansion is beginning. Demand for hay has been exceptional in recent years due to drought-reduced supplies in many areas of the country. Also, high grain prices the past several years have contributed to hay acreage being converted to grain production. The result is continued strength in the hay market.