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Herd and Feed Management

The Texas Dairy Industry’s Feed and Forage Outlook

Feed is the largest expense on most dairies, and it moves with weather, grain markets and hay supply. Instead of guessing at numbers, this outlook shows you which drivers matter and where to read the current data yourself.

Illustration for the farm.FM story “Dairy One Forage Lab Rates Hay “Adequate”; Farmer Rates Its Price “Catastrophic””
A farm.FM story on hay and feed costs fits this Texas dairy feed and forage outlook for producers. Read “Dairy One Forage Lab Rates Hay “Adequate”; Farmer Rates Its Price “Catastrophic”” on farm.FM.

What drives feed and forage costs in Texas?

Three forces dominate: weather on forage and grain fields, the price of corn, soybean meal and byproducts, and the cost of moving feed to the dairy. A dry spring in the Texas Panhandle or a flood in the Brazos bottoms can shift hay and silage supplies fast.

Byproduct feeds, such as cottonseed and distillers grains, add another layer because their price follows other industries. A dairy that understands its ration inputs can see price shocks coming sooner.

Stephenville-area producers often buy part of their feed and grow part, so the mix of home-grown and purchased feed matters as much as any single price.

Which reports should you follow?

The best outlook is one you build yourself from official data. Follow USDA NASS crop reports for acreage and production, USDA Economic Research Service for feed and farm-economy analysis, and USDA AMS market news for hay and commodity prices.

Add the weekly drought picture from the U.S. Drought Monitor and local forecasts from the National Weather Service. Check them on a regular schedule, not just when prices spike.

Figures change constantly. Read the current numbers at each source and note the date you pulled them.

How do you build a simple feed budget?

Start with what your herd actually eats. Pull the last twelve months of feed invoices and your ration sheet, then sort costs into forage, grain, byproducts and supplements. A plain spreadsheet works fine.

Next, mark which items you can lock in with a forward contract, which you can store and which you must buy at spot prices. That split tells you where your risk lives.

Add a row for freight and shrink, because losses at the bunker or bale yard are real money.

How can forage planning reduce risk?

Own forage is often cheaper than purchased forage in a good year, but dry years can reverse that. Rotate crops, keep a reserve of stored feed and think about how many acres of silage you need in a bad season, not an average one.

Talk to your nutritionist about acceptable substitutes before you need them. Switching feeds in a hurry can hurt milk production and cow health.

Texas A&M AgriLife Extension publishes forage and dairy nutrition information, and the herd-focused tips at this dairy herd guide offer practical background.

What about margins and price protection?

Feed cost is half of the margin story. Milk price minus feed cost is what pays the bills, which is why Dairy Margin Coverage is built around that gap. Check current program terms, signup rules and costs directly with the agency.

Talk with your lender and accountant about whether to hedge, forward contract or simply hold more cash. Farm Credit and local banks can explain how they view feed purchases when they set a line of credit. For a plain look at farm finance, the farm money guide is a sensible read.

What should you do when prices spike?

First, avoid panic buying. Check with several suppliers, compare delivered prices and ask about volume timing. Look at your inventory and your cow groups, and see whether a ration change can trim cost without hurting performance.

Second, tell your lender before a shortfall shows up. A short, honest call beats a surprise on the due date.

A little humor helps in tight years, and farm.FM has dairy stories and satire for exactly that.

Write down your top three triggers, such as a hay price level or a drought category, that will make you change plans.

Where can you read more?

For trade coverage, Hoard's Dairyman follows dairy nutrition and markets, and USDA Dairy Market News reports on dairy products. Over at farm.FM, the farm economics stories keep an eye on input costs, and a farm.FM story on hay and feed costs fits this topic nicely.

Treat any outlook, including this one, as a starting point. Your own numbers, your nutritionist and the official reports are the real guides.

Sources and further reading

Ask locally: Ask your dairy nutritionist and a Texas A&M AgriLife Extension forage specialist to review your ration and feed plan.

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