(upbeat music) - Hello everyone, and welcome to Sunup.

I'm Lyndell Stout.

It may be the middle of summer, but it won't be long until we're starting to think about putting up hay for the winter.

So just how much does a bale of hay actually cost?

To run the numbers, here's OSU Extension Ag Economist, Dr. Eric Devuyst.

- Hello, I'm Eric Devuyst, Extension Economist at Oklahoma State University in the Department of Agricultural Economics.

Today I wanna talk to you about the economic cost of a bale of hay.

It's haying season in Oklahoma.

I hope by the time this airs, you've wrapped up putting up your prairie, or native hay grasses.

One of the things that we see frequently is producers are not thinking about what are all the costs that go into a bale of hay.

Of course, people know about the bailing cost, but if you bale it yourself, what should that cost be?

Well, we recommend putting in what are the customer rates right now in your area, because that's your opportunity cost.

In other words, if you didn't bale your own hay, how much could you get for bailing somebody else's hay.

For bailing a round of hay, a five by six round, 1400 pounds, we could expect to spend around $28 to have that done custom, for the cutting, raking and bailing.

So we use that to represent the opportunity cost of putting up a bale of hay.

Then we have land charge into that.

We need to be charging something for ourself, for our own land.

Even if it's ours and we're not paying rent to somebody, we're defacto paying rent to ourselves internally.

And so about $25, 20 to 25, maybe 30 for more productive grounds.

And then one of the most overlooked numbers is the cost of the nutrients in that bale of hay.

So for native hay, prairie hay, we typically don't apply nitrogen.

So we'll ignore that for a prairie bale of hay, but there's phosphorus in that bale, so you're looking at about two and a half pounds of phosphorus in that bale of hay.

Most of our soils in Oklahoma, a large percentage of them are deficient in phosphorus.

If I don't replace that over time, I'm going to affect that plant community out there.

I'm probably gonna get some lower quality forages.

That two and a half pounds of phosphorus, it's gonna cost you about $5 plus per round for a 1400 pound bale of hay.

If we have 1.1 tons to the acre for our prairie hay, we're looking at about $51 a bale for a 1400 pound bale of prairie hay, native hay.

And if you look at prices right now, you'll see 'em all over the place, 35 to $55, depending on how big they are, the quality of the hay.

And so at $50, if you're selling that for $50, you're pretty close to breaking even economically.

But what that means is you're actually turning an accounting profit on it, because a number of those costs, including the phosphorus and the land charge, might just be internal.

And so you're doing alright if you're getting about 50 bucks a round.

Less than that, you better come back and look and see whether you're actually, that's sustainable over time.

Bermuda, this bale has about 3.4 pounds of phosphorus in that.

And then we also are gonna put nitrogen on that field.

The nitrogen that's in the bale of Bermuda hay is only a fraction of what actually gets put down, because you're gonna lose nitrogen to volatilization, and then you're gonna get a lot of tissue growth that's not harvestable.

The lower part of the stems, the roots, for example.

So typical rate would be around 200 pounds of actual ample acre per year for Bermuda.

So there's about $13 of nitrogen per bale that's applied, even though that's not, there's less nitrogen in the bale.

And then we got almost $7 of phosphorus in a bale of Bermuda hay, and we're probably gonna put herbicide down if we're trying to sell it as weed free hay.

It comes down to you're around $58 to $60 a bale for Bermuda hay.

If you look at the hay markets right now, look at what's advertised out there.

You'll see a lot of Bermuda hay in that $60 range right now.

So if you can put that bale up and sell it for 60 bucks a round, you're gonna turn an accounting profit and break even in terms of economics.

(upbeat music) - Wes Lee here, and welcome to the Mesonet Weather Report.

A common question I get is whether climate change is having an impact on our total rainfall amounts.

To answer that, let's look at the data.

The latest version of Noah's Climate Impact report included this map.

It shows how rainfall over the past 30 years compares to rainfall in the early 1900s, indicating a five to 15% increase in total precipitation in the east, and a similar reduction in the west.

For Oklahoma specifically, we can look at this rainfall graph over time.

It shows five year weighted tendencies, along with the year's average total rainfall.

I have broken down the higher than normal years versus the lower than normal years on this table.

- Since 1980, the state has been drier 32% and wetter 68% of the time.

Also shown are the west and east sides of the state.

We see a higher percentage of dry years in the west versus the east, but still more wet than dry years.

For the 44 years before 1980, it is pretty much the opposite.

More dry years, 59%, versus wet years, 41%.

Gary is up next with the latest version of the drought map.

- Thanks, Weslin.

Good morning everyone.

Well, we do have some changes on the drought monitor map.

We remained mostly steady last week, but unfortunately those changes aren't good.

Let's get right to the new map.

As you can see, we do have more of those brown colors down across southwest Oklahoma.

A little bit of an increase over in east central and southeast Oklahoma in those yellow colors, the abnormally dry conditions.

As always those yellow colors mean areas coming into or going out of drought.

In this case, unfortunately, it's going into drought.

So as I said, we've gotten a gift from those temperatures.

If you look at this statewide average high temperature map from the Oklahoma Mesonet, starting on June 1st all the way through the end of July, we do see much of July below normal in temperature and greatly below normal in temperature.

In some cases, less than 10 degrees below normal.

So when we look at that over the long term, we do see much of the summer, however, has been above normal temperature.

That's when we had those flash drought worries.

Like I said, the rainfall certainly helped as well.

You know, the temperature goes hand in hand with those rainfall deficits.

But when we do have above normal precipitation, that can certainly take care of drought.

Over the last 30 days, we see scattered good amounts of rainfall three to four to five inches, especially down in southeast Oklahoma.

When we look at that on the percent of normal rainfall map from the last 30 days, that same timeframe, then we can see the generous rainfalls up across Northwestern and West Central Oklahoma a little bit down in the Southwestern and in southeast Oklahoma.

It's fairly scattered, but we also see those deficits in some cases less than 30% of normal, all the way down to 15% of normal.

That's it for this time.

We'll see you next time on the Mesonet weather report.

(bright music) - A few weeks ago, you may have caught our livestock marketing segment with Dr. Derrell Peel and SUNUP's Kurtis Hair all the way in Scotland.

Well, today it's time to find out what those guys are actually up to in the UK.

(bright music) - [Kurtis] Scotland, the land of castles and cities of stone surrounded by scenery greener than the Emerald City.

And home to some shockingly great beer.

Now, you may be asking yourself, "What exactly is Kurtis doing in the UK?"

Don't worry, we'll get there.

So sit back and let's explore the rugged beauty, that is Scotland.

(bright music) Edinburgh, the capital city of Scotland.

It's the first stop for me and livestock marketing specialist, Dr. Derrell Peel.

Derrell, along with agricultural economics professor, Beth Norwood, organized this trip as a study abroad opportunity for a group of OSU students.

- This is the second year of a study abroad course.

You know, because we were coming over here anyway, we made arrangements for you to come with us and we've spent the week documenting some agricultural stuff.

We visited the vet school at the University of Edinburgh.

- [Kurtis] The Royal Dick School of Veterinary Studies is one of the most prestigious veterinary schools in the world.

And they organized a facilities tour for Derrell and me to see what dairy, beef, and sheep production looks like in this part of the world.

After a few days of exploring and getting the chance to see Scottish agricultural up close, it's finally time to head to the airport to pick up the students - Right here.

Alrighty, you made it.

- [Kurtis] A quick stretch and a few yawns, and it's time to get started.

On a trip like this, time isn't something that you waste.

The walking one of the most famous stretches of road in the world right up to a castle is a great way to shake off that eight-hour flight.

It's called the Royal Mile.

Dating back to the 12th century, this stretch of cobbled road leads a steady steep incline all the way up to Edinburgh Castle.

Not exactly like stepping back in time, but it's pretty close.

As you can tell, this is more of a touristy part of the journey, mainly to keep the students from falling asleep because tomorrow is when the ag part of the trip really begins.

- So this year, the Royal Highland Show is actually the first full day the students have been here.

So we're beginning the trip with this big day here at the show.

- I've just experienced so much already.

We've only been here for a day and we're here at the Royal Highland Cattle Show and seeing all the different types of agriculture.

- [Kurtis] Hannah Doherty is one of the students who is selected for this trip.

And she says the past few days have been a wonderful whirlwind.

- I think what really surprises me is actually how in great conditions the buildings are for how old they are and how green everything is.

- It's just absolutely breathtaking.

- I think it's, a part of college is learning.

So, exposing you to new things.

- [Curtis] As I mentioned earlier, OSU Ag Economics professor, Beth Norwood, organized this study abroad class with Derrell.

She says trips like these have a massive, positive impact on the students.

- So about half the trip is learning about agriculture, meeting with the universities, government officials, and then we also do some of the historical trips and cultural things really to get the students a great exposure to not only how agriculture is different in this country, but also how food and anything aspects of life are also different.

- I mean, yeah, just kind of how big the city is, honestly, and how like, you know, it's so old, everything's so old, and it's like, wow, all the history here.

And I guess I knew what to expect it, but I guess I couldn't have been prepared for that, so.

- [Curtis] Like Hannah, fellow study abroad student, Owen Brown, says the trip so far has been amazing, though the similarities between Scottish and US agriculture are surprising.

- Kind of, you know, for as different as I thought it would be, it's very similar.

A lot of things like, you know, we're showing cattle and looking at all the food and all that kind of stuff, and there's just not as much of a cultural disconnect as I would've thought there'd be.

- I've just experienced so much already.

We've only been here for a day.

Seeing all the different types of agriculture in a different country is just amazing.

And the beautiful countryside and different cultures to see and how old everything is, it's been a really great experience.

- I tell you what, if you just listen to the students when they first come in, you understand the value so much.

It's just, it obviously, it opens their eyes to new things.

Well, it's important to me because it's exactly what happened to me.

You know, I went through the same thing, once upon a time, and I remember how much it opens your eyes and it takes you out of a little box and shows you that there's a lot bigger box.

And I think that's our primary challenge.

In the College of Agriculture, we get a lot of great kids, you know, all the right background and work ethic and all of those things, but what they haven't seen is a lot of the world.

(bicycle rattling) - Aberdeen, Scotland.

(seagulls squawking) A port city nestled right into the banks of the North Sea, where the next leg of the journey for these students will begin, and new experiences and memories will undoubtedly be made.

But they're not the only ones affected by this journey.

(seagulls squawking) You see, as an Okie who grew up in a rural community with endless grids of dirt roads, walking these cobbled streets and cities of stone, it's just, well, hard to put into words honestly, overwhelming.

But in the best way.

Working closely with Derrell and his wife, Pat, making friends with the locals, exhausting mountain hikes, riding my first train, which is one of the most beautiful experiences these landlocked eyes have ever seen.

A chef's kiss of a work trip.

Though having roughly only about three and a half hours of complete darkness at night did get to me.

(seagulls squawking) In just a few hours, Derrell and the students will be hopping on a ferry and heading up north to the Shetland Islands.

And as for me, well, it's time to start my long journey back to Oklahoma.

So from Scotland here in the UK, I'm Curtis Hare.

Well, as you can see, Derrell and I are back in Oklahoma.

So Derrell, the last time I left y'all, it was an Aberdeen, Scotland, but y'all actually continued on north to the Shetland Islands, right?

- Yeah, so with the study abroad course, you know, we continued up to the Shetland Islands, which is the farthest north point in the UK.

So that's a overnight ferry ride to get there.

Really interesting place, obviously, very far north, and we were there on about the longest day of the year.

So there wasn't a lot of darkness while we were there.

And then, but we got to see, you know, some traditional agriculture craft farming, some traditional sheep production, as well as a lot of archeological and historical information while we were there.

- Well, I could talk Scotland and Tennent beer all day, but I'm sure our viewers would like to know what's happening in the livestock markets.

So let's just jump right in.

We've been talking about herd rebuilding.

Is that any indication at all that that's happening?

- No, you know, we're still getting smaller, actually, as an industry.

We started this year with the lowest cattle numbers in decades.

The indications are that the herd has gotten smaller this year.

We're looking for signs of, you know, there's two things that'll happen when we start herd rebuilding.

One will be heifer retention.

That's the big one that we're looking for.

The other one is that cow culling will reduce to minimal levels as producers try to hang on to cows a little bit longer than usual.

Cow slaughter is down about 16% this year.

But if you look at it in the context of the broader set of numbers, that's probably not enough to indicate that we are actually in the process of herd rebuilding.

That's still going to give us a culling rate of 10 to 11%.

It'll probably drop down around 9% when we start rebuilding the herd.

July 1 cattle on feed report also included a breakdown of steers and heifers and feedlots.

And those numbers indicated that we still have right at 40% of all the feedlot inventory is heifers.

So, we continue to place heifers in the feedlot.

We're not keeping them out in the country apparently at this point.

And so, that's a process that has yet to get started.

- Do you have any idea when that might begin?

- Well, there's a couple things that are going to have to happen.

One is obviously when can we do it?

That's a question really of the drought situation.

I think by and large, we've had better forage conditions this year, and some folks can do it and probably are doing it to a limited degree.

But there are concerns going forward about reemerging drought, and particularly with the idea of La Niña rebuilding in the US.

That's a concern for later this year and on into next year.

So that may be holding folks back a little bit.

The other part of it is just.

- Producer expectations, which is a function of the financial situation, the cost of financing, herd rebuilding, and just producer expectations for these markets.

They're enjoying these high markets right now,.

but the question is, how long will they last?

Will they last long enough to make it worth that investment in in those heifers for future production?

Apparently producers don't believe we're there yet, so they have not started that process.

- Alrighty thanks Darryl.

Dr. Darryl Peele, livestock marketing specialist here at Oklahoma State University.

- [Narrator] We just wanna take a quick break in the show to talk about a great opportunity to learn more about the canola industry.

The regional canola meeting will be held at 10:00 AM this Wednesday, August 7th at the Chisholm Trail Expo Center in Enid.

Topics will include variety, performance, and development, management practices, and marketing.

For more information, go to sunup.OKstate.edu.

(upbeat music) - We're talking crop markets now with Dr. John Michael Riley, an associate professor in the Department of Ag Economics.

John Michael, thanks for being with us.

- So glad to be here.

- Dr. Anderson retired a a couple of weeks ago and you're gonna be filling in for a while, so let's tell our viewers a little bit about yourself.

- Certainly, so I grew up in Mississippi and was familiar with Oklahoma prior to coming here with this position, I spent some time at Northeast Oklahoma at the junior college there.

Then I went back to Mississippi to finish up my undergraduate work, stayed there a little bit longer, ended up at Kansas State for a little while working on my doctorate, and then actually went back to Mississippi after that.

Spent some time there as an extension professor doing similar work to what we're discussing today, crop markets, cattle markets, was kind of my duties there.

And then eventually I had an opportunity opened up here at Oklahoma State for a teaching position and I brought the family and we've been here ever since the summer of 2015 and really enjoyed our time here at Oklahoma.

- So you were primarily classroom instruction and then some research as well, right?

- That's correct, my position is predominantly in the classroom and I spend a bulk of that time in the undergraduate working with undergraduate students and undergraduate courses.

And so that is my primary duties and where I get a lot of joy and passion.

My courses are follow markets, so I teach a course on agricultural markets at the junior level and then commodity futures markets at the senior level, and so a lot of what we're discussing today is what I really focus on with the students.

- Alright, well let's dive right in.

Let's start with the wheat market and how things are looking there.

- Well, I think the word there is kind of grim and I think that's really been the case for the past couple of of weeks as we've, you know, prior to harvest and then coming in and then through harvest.

We're almost done with harvest here in the us, certainly done here in Oklahoma.

Yields are really strong and I think that really is the story that's carrying the market right now is strong yields, the total acres on par with where we've typically been.

You add those extra bushels in and it just puts a lot of pressure on the supply side of the market.

Futures market this morning was around five, mid five, five and a half.

And so, and that's been down from even last week.

We look at basis across the state, that's generally somewhere around, you know, negative 40, negative 45 cents a bushel and put that with the futures market, and that's where we're at right now with prices that puts prices about five.

And if you look across the state, that's where they generally are at in that $5 mark.

- We have some international factors too that also kind of put pressure on prices, don't they?

- That's the yields in the US being strong, and also if we look across the globe, Russia's crop, the crop in the black belt region, all of that is adding some additional pressure.

Russia tends to, is certainly dominant right now in the export market.

They have the cheapest wheat out there on the market.

They are certainly undercutting a lot of, you know, other exporters and you know, everybody's kind of gravitating toward that Russian wheat.

And again, it's just kind of building up those supplies here in the US.

- Well, let's take a look now at some of the other crops and give us an update on on what you're seeing there.

- Absolutely, let's start with corn again, kind of the similar story to wheat, and I think this is the case for soybeans as well.

Pressure's the name of the game.

We're starting to look toward what the crop is gonna look like here in the US as we start to look toward harvest.

The crop looks really good.

The weather is shaping up to be pretty good.

I mean there's, there is some worries about drier conditions in the corn belt right now that the market is key in on, but those really haven't shown themselves enough to really boost anything.

Again, the pressure is, and then the pressure's coming from the supply side of the marketplace.

- And then what are you seeing in terms of soybeans and cotton?

- So soybeans, it's a similar story there.

I mean I think that what I had to say about corn kind of follows through, probably the biggest difference there is is soybean oil is kind of the focal point right now that's filtering back towards soybeans, soybean oil market's under some pressure and that's adding additional pressure to the soybean market.

In fact, if it looks a little bit more grim than even corn and wheat.

Cotton prices are in that mid seventies, low seventies cent per bushel, per pound, and a lot of that has to do with the crop looks pretty good.

There's expectations of a wetter, wetter moving toward we as we get toward harvest.

And then also another thing that cotton really keys in on relative to other crops is the dollar index, because we export so much of our cotton, the strong dollar is also putting some additional pressure on the cotton side of things that maybe the other markets aren't as folk focused in on.

- All right, John Michael, great information.

Thanks for the context and we're glad to have you on board with the sunup team.

- So glad to be joining you.

- Okay, we'll see you again soon.

(upbeat music) - Good morning Oklahoma and welcome.

- Welcome to Cow-Calf Corner.

Well, we're working our way into August, and this week's topic is cover crops.

Cover crops have gotten attention over the years.

There's quite a bit of data that shows us benefit, particularly on intensively managed agriculture land.

If we put in a cover crop, something like a cool-season cover crop, we potentially do a lot to help the health of the soil, we increase the water-holding capacity, we can decrease our need for nitrogen fertilizer at some point in the future.

If we plant certain things, we can actually help to break through that hardpan soil and maybe bring up a little calcium, and improving that soil health and that water-binding capacity long term.

There's an increasing amount of evidence that we can actually improve calcium content, maybe reduce greenhouse gas emissions.

Regardless of where you stand on a lot of these things, we need to determine our objectives for cover cropping, and think about what cover crops are gonna work in a particular area based on our soil and our climate.

And in establishing those goals, it can be something as simple as trying to improve the health of the soil, maybe breaking that cycle if we've got some kind of issues in there in terms of disease or parasites, of having a different cover crop mix in relative to a crop field.

We need to address, are we doing this for the sake of wildlife?

We can put in some legumes and actually improve upon the nutrition of wildlife species.

Whenever warm-season grasses are pretty scarce come spring, are we looking at this strictly as a matter of how many pounds of beef we can take per acre off of a certain field?

So there's a lot of different cover crops we can use.

We wanna start off establishing a budget.

We wanna think about a diverse mix in a lot of cases, particularly if we're putting it in for the sake of a conservation purpose.

If we can mix some legumes with different types of things, we wanna make sure we've got a well calibrated, no-till drill or potentially planter.

No-till as a means of establishment and getting that seed to soil contact is preferred, 'cause that's gonna help us in terms of soil moisture as well.

And as we look at doing this going into the fall and putting some kind of a cool-season cover crop mix in place, it is important to maybe not get as hung up as what we would if we're putting in wheat and rye for grazing where we want it in by late August or early September.

As we think about cover crops that we may be putting in or no tilling into a warm-season grass like Bermuda, we may wanna get a little deeper into the fall and kind of play the climate, soil conditions, and weather forecast by ear relative to that most optimum time to get 'em in, and that's potentially later into September or potentially October.

So determine your goals, stick to a budget based on what you're trying to accomplish is critical.

Monitor what happens, and what the health of that soil is over time.

And, as you think about a well-calibrated drill and some of those issues, that does come into play, we recommend no-till drilling if possible.

And if you're interested in determining what and if this is a fit for you in terms of cover cropping, visit with some extension agronomy specialists or potentially some seed dealers, and give thought to what maybe gives you the most bang for your buck.

Final thought is you might investigate, I know that in the year 2017, about one-third of all the cover crop mixes that went into the country actually received a cost share, either from USDA or at the state level.

So things to consider as far as cover crops.

As always, I hope this helps, and thanks for joining us this week on Cow-Calf Corner.

(gentle music) - That'll do it for our show this week.

A reminder, you can see us anytime on our website, and also stream us anytime on YouTube, and follow us on social media.

I'm Lyndall Stout, have a great week, everyone.

And remember, Oklahoma agriculture starts at SUNUP.

(gentle upbeat music) (gentle upbeat music continues) (gentle upbeat music ends) (gentle music)