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Severe to extreme drought conditions in Central and Southern Colorado are affecting local farmers and ranchers, with effects rippling to other residents like horse owners.

Hay – grass and alfalfa – constitutes the area’s primary crop, and Chaffee County rancher Cal Paplow said hay prices have increased significantly this year. “Everybody’s worried there won’t be a second cutting; it’s all water-related.” And with a second hay crop in question, many producers aren’t selling any hay from their first cuttings.

Given the limited amount of hay available locally, the current price for small square bales is between $11.50 and $13 a bale, said western Fremont County rancher Frances Livings.

The latest information from the U.S. Department of Agriculture puts bulk hay prices in the $7 range for small square bales but provides no indication of availability:

• $280 per ton ($7.75 per bale) for small square bales of premium quality grass hay in Colorado’s mountain region.
• $350 per ton for large square bales of premium organic alfalfa in the San Luis Valley.
• $235 per ton ($7 per bale) for small square bales of premium alfalfa-grass mix in southwestern Colorado.

Additional data from the USDA show 53 percent of the pastures and rangeland in Colorado are in poor to very poor condition with 78.67 percent of the state experiencing some level of drought, compared to 6.18 percent a year ago.

Terry Scanga, local rancher and general manager of the Upper Arkansas Water Conservancy District, said he believes the price of hay is going to get “pretty high,” and he thinks that will persist into next summer, “even if we have normal or above-average precipitation.”

As Paplow said, it’s all water-related, and Scanga noted several factors in play during current drought conditions.

“Tributary supplies may dwindle, even for senior water rights,” said Scanga. So anyone (a) with a junior water right or (b) relying on a tributary stream will only get one cutting of native hay, “but not a good one. That’s where you’re going to see (supply) reductions.”

Owners of senior water rights will be able to continue irrigating and get a second cutting, especially if they divert water directly from the Arkansas River, said Scanga. “The mainstem still has pretty good flow.”

The Colorado Division of Water Resources reported flows of 581 cubic feet per second at Salida as of Tuesday, July 3.

Scanga expects ranchers to reduce the size of their cattle herds, selling cattle to “match demand with the amount of hay they have. … The immediate impact may be downward pressure on prices on beef. After that we’re going to see upward pressure because of the lower supply.”

As Scanga pointed out, ranchers are in business for the long haul. “They know there are going to be years like this. They know they have to be flexible and adjust the size of their herds.” Dry conditions are prompting speculation, he added, which is contributing to price increases.

On the other hand, “Rain could change all that. … We could start seeing monsoons” or “get rain on the prairies,” which would allow other ranchers to buy the cattle being sold and graze them where they have forage.

Scanga also talked about the impact of extreme drought conditions in the San Luis Valley and the rest of the Rio Grande River basin. The Valley has “big producers,” each with five to six 160-acre center-pivot irrigators.

Because the San Luis Valley water table has dropped for several years, ag producers must now purchase augmentation water, driving up the cost of raising crops. And alfalfa, an important source of cattle forage in the high country, consumes a significant amount of water.

As a result, Scanga said, many producers have gone to different kinds of crops, like hemp, that require less water, further decreasing the supply of hay.

Scanga also noted that the market for horse hay “has always been volatile,” and horse owners “want the best quality” so they tend to pay more for their hay than ranchers pay for hay to feed cattle.

Regardless, the consensus in the ag community is that anyone needing to purchase hay this year will pay high prices, and they may have to look outside the local market to find it.