|2013 Market Report
The heat waves from the summer of 2012 are still being felt across the seed industry. The drought of 2011 that affected Texas, Oklahoma, and parts of Kansas and Nebraska encompassed the heartland in 2012. From Mexico to Canada, from the Mississippi to California the drought covered more geographic territory than the Dust Bowl. Dry conditions and record setting high temperatures decimated seed crops and harvest bins were left less than full.
Commodity prices, such as wheat and corn, remain high creating competition for seed production acres. Acres and acres that once produced grass seed are being plowed up to raise grain crops that result in a faster return on investment. High commodity prices, rising demand from government agencies coupled with the economic impacts of the past 3 years has hamstrung the supply side of the market.
Demand for native warm season grasses has been on a steady rise for the last 2 to 3 years with CRP being the major player. Persistent drought and below normal yields have severely impacted the supply. Specific varieties and species may not be commercially available in 2013 which could force a paradigm shift in seed mix design. Yellow Indiangrass, Blue Grama and Prairie Sandreed are among the species most notably affected.
Cool season native grass supply has been largely affected by demand from the Bureau of Land Management and fire restoration across the arid west. Certain species and varieties are trading at record highs and will not be available until the 2013 crop. The number of acres for seed production continues to decline resulting in higher prices as seed growers try to meet the demand.
Pricing for native forbs has been stable but is starting to soften on major species. The CRP pollinator program has been a major user of forbs but the “Fiscal Cliff” facing congress has funding for conservation programs on the back burner.
Supply for native shrub seed has a direct correlation to the demands of the BLM. Huge purchases in 2012 have severely limited the supply of major species resulting in record high prices in late 2012. New harvest has softened the market slightly heading into the New Year but prices remain 4 to 5 times higher than the record lows of 2010.
Proprietary Alfalfa prices are up slightly but stable. The supply of common alfalfa varieties continues to be threatened by competition for production acres. Prices are rising and the price gap between public and proprietary varieties continues to narrow.
Persistent drought continues to force hay and forage prices to record highs. Small grains and forage sorghums that use less water are in high demand for a lower cost feed source resulting in higher seed costs. Anything that can be baled and hauled is worth significant
dollars. Supply is tight but should be adequate.
The battle for production acres to grow seed for major turf grass species continues throughout the Pacific Northwest. Supply for high quality proprietary varieties are limited. Lower yielding varieties are being discontinued with strong upward price movement.
Organic seed producers continue to try and meet the increasing demand of this growing segment. The list of certified organic products continues to expand but inventories of these items sell out quickly. Prices typically command a premium in relation to conventional seed prices.