The phase one deal between the US and China sets the stage for timothy export protocols. The Chinese have 30 days after the deal is finalized to establish the new protocol for timothy. There is still uncertainty around how strong demand will be, but the ability to ship to China is favorable for northwest timothy growers.
Chinese buyers tend to focus on "clean and green" alfalfa grades. If this turns out to be the trend with timothy, this news should provide some optimism to a market oversupplied in mid-grade timothy. How much timothy will China buy?
Australian Oaten Hay
Australia was on track to export 1.1 million tons of oaten hay. These exports are split between Japan, South Korea, Taiwan, China and a few other countries. However, this forecast is in question as demand in Northern Australia outstrips available supplies in the southern part of the country.
“There’s still a lot of hay in Western and Central Victoria as well as South East South Australia, but all reports suggest it’s being snapped-up quickly by those in drought affected regions. The Australia Fodder Industry Association revised its market forecast and now anticipates a shortage of fodder by as early as March or April 2020, without a widespread and adequate autumn break."
For the 2020 season, Australia may come up short in meeting their export forecasts. There is still uncertainty around how strong demand will be, but the ability to ship to China is favorable for northwest timothy growers. A possible Australia supply shortage favors exports of timothy to all asian countries, namely China. This is an opportunity to make inroads to China.