Hay Market Research: Hungary

Delivered October 2nd, 2020

Part

of eight

Part

Hay Market Research: Hungary, Part 1

Hungary produced 1.03 million tons of hay in 2018, while the total market value was HUF 18.06 billion. The requested information about the hay production and exports has been entered in row 10, columns C-I of the attached spreadsheet and a brief overview of the findings is presented below.
Hay Production and ExportsHungary produced 1.01 million tons of lucerne (alfalfa) hay and 12.5 thousand tons of red clover hay in 2018. In total, the country produced 1.03 million tons of hay.
The gross production value of lucerne hay was HUF 17.88 billion in 2018, while the market value of red clover hay was HUF 182 million. In 2018, the total market value of produced hay was HUF 18.06 billion.
The total amount of exported lucerne hay was 868 tons in 2018, which is a significant increase compared to 2017 when the total export was 139 tons. There were no direct exports for red clover hay in 2018.
Austria was the largest export market for hay, lucerne, clover, and other similar forage products in 2019. Other countries to which Hungary exports this commodity group include Italy, Slovak Republic, Switzerland, Serbia, Croatia, Bosnia and Herzegovina, Germany, Montenegro, and Romania
Research StrategyTo obtain information for the hay market in Hungary, we first searched government webpages such as the Hungarian Ministry of Agriculture and the Hungarian Central Statistical Office. We found that the main hay crops in Hungary are alfalfa and red clover hay and also their production and market value. While these government sources provided us the hay production and market value, there was no data related to countries to which Hungary exports hay. Next, we scanned various databases such as World Integrated Trade Solution, UN Trade Statistics, International Trade Statistics, Trend Economy, and others. However, there was no information related to hay exports to specific countries, and most of these sources included the data for the broader commodity group (swedes, mangolds, fodder roots, hay, lucerne (alfalfa), clover, sainfoin, forage kale, lupines, vetches, and similar forage products). Since there was no other available information, we used the available information to calculate the total hay production and market value and we included the list of countries to which Hungary exported hay and other similar forage products. The calculations for hay production and market value are presented below.
CalculationsHay Production

Lucerne (alfalfa) hay = 1,012,878 tons 
Red clover hay = 12,509 tons 

Total production = Lucerne (alfalfa) hay + Red clover hay
Total production = 1,012,878 tons + 12,509 tons 

Total production = 1,025,387 tons

Hay Market Value

Lucerne (alfalfa) hay = HUF 17,877,000,000 
Red clover hay = HUF 182,000,000 

Total market value = Lucerne (alfalfa) hay + Red clover hay
Total market value = HUF 17,877,000,000 + HUF 182,000,000 

Total market value = HUF 18,059,000,000

Part

of eight

Part

Hay Market Research: Hungary, Part 2

Hungary produces over a million tonnes of alfalfa hay annually. Data on the country's production of bentgrass, bermudagrass, fescue grass, kliengrass, meadow/pasture hay, oaten grass, timothy grass, sudan grass, and orchard grass could not be found or deduced. The information we gathered can be found in the attached spreadsheet.
RESEARCH HIGHLIGHTSHungary produces 12,509 tonnes of red clover hay annually. 
The country's production of ryegrass is 31,879.
Over a million tonnes of alfalfa hay are produced by Hungary annually. 
RESEARCH STRATEGYTo find or deduce the total hay produced by crops like Alfafa, bentgrass, and clover in metric tons, we first consulted government resources, such as the website of the Hungarian Chamber of Agriculture. While this was a dead end, 
the Hungarian Central Statistical Office was referenced on the website. The 
Hungarian Central Statistical Office provided a breakdown of the production, average yield, sown area, and prices of different crop categories, including cereals, industrial crops, fodder crops, dried pulses, and vegetables. Through this, we were able to find the production data for alfalfa, rye grass, and red clover, however, production data for other crops, including bentgrass, bermudagrass, fescue grass, kliengrass, and orchardgrass, was not provided. 


Our next step involved scouring agriculture journals in Hungary or in general. We came across reports by Agrarszektor Hungary, which provided an overview of grass production in Hungary, but there was nothing specific to bentgrass, bermudagrass, fescue grass, kliengrass, meadow/pasture hay, oaten grass, timothy grass, and the other crops mentioned in the spreadsheet. 


Next, we attempted expanding our scope to trusted databases that offer data on the production of different crops by country. Through this, we encountered OEC World and the Food and Agriculture Organization of the United Nations. Although these resources offered the production value of forage crops in Hungary, there was no data on the crops used to make hay specified in the spreadsheet. 


Being that there was no readily available data on the other crops from credible resources, the research team elected to identify and explore the total number of acres or hectares used to grow the other specified crops or how these crops are grown. The above mentioned strategies proved futile in gathered this information. As a result, NA has been entered in the relevant sections. 

Part

of eight

Part

Hay Market Research: Hungary Part 4

According to the Europian Commission, Hungary's pellet production amounted to 40,000 tons in 2011. Tama and Gruppo Carli are some of the round and square bale producers in Hungary. All the information has been entered in the attached spreadsheet.
NotesAccording to a 2012 report by the European Commission, Hungary produced 40,000 tons of pellets in 2011, which represents roughly 3.9% of the total hay produced on the country.
Tama and Gruppo Carli are some of the round and square bale producers in Hungary.
 Tama Hungary offer small round and square bales for sale, weighting 8 kg each.
Gruppo Carli offers both small and big square bales that weigh between 25 kg up to 900 kg per stack.
Research StrategyOur research focused on government analysis and industry reports. Our research took us to the Hungarian Census, the FAO, and the European Commission but information on the breakdown of hay product by production type was largely unavailable. For instance, the Hungarian Census has a lot of data on the production and the use of the produced hay in the country but they do not specify whether that hay was used in pellets or bales. We did find a report by the European Commission that detailed the amount of pellets produced by Hungary but the information from 2011 and it also took into account wood pellets. However, according to the report, the majority of pellets are produced using agriculture products, so we can assume that the 40,000 tons detailed in the report are primarily produced using hay crops.

Part

of eight

Part

Hay Market Research: Hungary, Part 4

The majority of the cultivated farmland in Hungary is owned and cultivated by small farms. As such, the majority of the produced hay is actually used by the local farmers to usually sustain their dairy production. Only about 25% of the total hay is exported or sold for other purposes. All the information has been added to the attached spreadsheet. 
NotesThe majority of the cultivated farmland in Hungary, 96%, is owned by small farmers that generate less than EUR 100,000 per year.
Grass hay is primarily consumed by farmers, while silage maize and green maize are also exported towards other countries.
About 81% of the cultivated alfalfa in Hungary is produced and used by local farmers ((665,445 +145,502) / 1,004,108).
Overall, about 75.1% of the produced hay is used by local farmers, while the other 24.9% is exported or sold for other purposes.
Research StrategyWhile we were able to calculate the amount of hay consumed by farmers by using the gross amount of hay produced against the amount of hay used by farmers and the intermediate consumption data provided by the KSH, finding the breakdown between the production from big and small farms was more challenging. We focused our research on government databases and industry reports but information about the total production of hay by small or large companies was unavailable. Several articles from the FAO and the NAK mentioned that a majority of the cultivated farmland was owned and operated by smaller farms but a specific breakdown was not given. We found by the European Commission that provided information about the whole agriculture landscape in the country. As no other information was available, we decided to use the data in that report to estimate the breakdown in the production of hay between big and small/local farms.

Part

of eight

Part

Hay Market Research: Hungary, Part 5

The amount of hay consumed by cattle, horses, sheep, and goats has been triangulated from the total number of animals in Hungary and the recommended daily nutrition needs by reliable sources.  The calculations are shown below and the results are both below and on the attached spreadsheet.  Calculations of requirements for pets could not be calculated.
CattleIn 2018, Hungary had approximately 870,000 live animals classified as cattle. 
Adult cows should eat approximately 36 lbs of hay per day.
Calculations
870,000 x 36 x 365 = 11,149,920,000 pounds in a year
 11,149,920,000 / 2204.6 = 5,057,570 metric tonnes.
HorsesIn 2018, Hungary had approximately 53,000 horses.
A full-grown horse eats between 12 and 15 lbs of hay a day.
Calculations of range
53,000 x 12 x 365 =232,140,000 pounds or 232,140,000 / 2204.6 = 105,298 metric tonnes in a year
53,000 x 15 x 365 = 290,175,000 lbs  or 290,175,000 / 2204.6 = 131,622 metric tonnes in a year.
Sheep and GoatsIn 2018, Hungary has 1.146 million sheep and 79,000 goats.
Calculations — Sheep
An average ewe should eat 1.5 lbs of hay per day.
1,146,000 x 1.5 x 365 = 627,435,000 pounds or 627,435,000 / 2204.6 = 284,602 metric tonnes per year.
Calculation — Goats
An average goat will eat between 2 -4 lbs of hay per day.
79,000 x 2 x 365 = 57,670,000 pounds per year or 26,159 metric tonnes per year.
79,000 x 4 x 365 = 115,340,000 pounds per year or 52,317 metric tonnes per year.
PetsIn 2019, Hungary had approximately 395,000 small mammal pets.
Research shows that calculating the amount of hay used by small animals is difficult.  Most reputable sources either say x amount per pound of animal weight or simply recommend filling up their cage daily with fresh hay.
A blogger on Reddit said she went through approximately 10 pounds of hay per rabbit per month.  Wonder does not consider that site to be a reputable source.

Part

of eight

Part

Hay Market Research: Hungary, Part 6

An overview of the hay market in Hungary can be found in row 10, columns AS-AV of the attached spreadsheet. The factors considered when purchasing hay include the nutritional content of the hay in relation to the target livestock, the stage or age at which the hay was harvested and the general hygiene of the bale. Hay suppliers in Hungary include Gawron KFT, T. G Hay KFT, ANIFEED HUN LTD, and Cargill Hungary. 
Hay Value DefinitionThe Extension provides the list of factors that determine the quality of hay that farmers produce, including the plant species, agronomic management practices, stage of harvesting, and manner of storage. These factors apply similarly across the globe, including Hungary. 
According to Drovers, the factors to consider when purchasing hay include the nutritional content of the hay in relation to the target livestock, the stage or age at which the hay was harvested and young shoots are preferred over old ones, and the general hygiene of the bale.
The University of Missouri dairy specialist, Ted Probert, says these factors should be keenly considered by any farmer purchasing hay in any part of the world, including Hungary.
Hay Selling ProcessThe hay-making structures used by hay manufacturers in Hungary include the barrack, the haystack, the hay heap, the hay bale, the round bale, the cubic bale, and the hay storage shack. The common practice by manufacturers is to make machine-produced hay balls covered with plastic.
 Alibaba provides the list of top hay suppliers in Hungary including Gawron KFT, T. G Hay KFT, ANIFEED HUN LTD, and Cargill Hungary. Buyers can purchase in-store or online and online buyers can preview the bales before they place their orders and Alibaba indicates that the suppliers can ship the hay to the buyers. 
The information provided by Alibaba shows that sales are weight-based and not volume-based and the common products are square bales, round bales, and pellets.
 Source 
 
.Source 
 
Common Practices MDPI reported that hay-making structures are still a common practice in most European countries, including Hungary. 
Traditional hay-making structures are used to store hay mostly as rounded or square bales. Modern farmers construct permanent hay
 storage structures that may be part of a stable or the farmer’s house. 
The emphasis on storage facilities in most parts of Europe, including Hungary implies that hay is aged on site to await buyers.

Part

of eight

Part

Hay Market Research: Hungary, Part 7

Hungrana Kft is a major player in the Hungarian hay market. Hay is mostly consumed domestically. Further details can be found in column AW row 10 in the spreadsheet attached.
Production
In 2018, the production of alfalfa hay in Hungary was 1,012,878 tonnes which was an increase when compared with 971,133 tonnes in 2017. 
In 2018, the production of red clover hay was 12,509 tonnes which was a decline from 14,169 tonnes produced in 2017. 
While Hungary has the 13th largest capacities for the production of alfalfa (lucerne hay) and pellets in the European Union (EU), the country has seen a growth rate of  -40.52% CAGR between 2012 and 2017. 
UseHungrana Kft’s Szabadegyháza processing plant “uses 60,000 tonnes of hay and up to 15,000 tonnes of sunflower husk pellets annually”. 
Research Strategy
Information about Hungary’s hay market is very limited. We consulted sources such as the Hungarian Central Statistical Office, the European Commission Hungary Country Report, government websites, and news sources. We were able to gather information about production, growth trend, and a major player within the market from reputable market reports such as Research and Markets, reputable industry-related news sources such as Bioenergy International, and press releases from the Hungarian Ministry of Agriculture.  

Part

of eight

Part

Hay Market Research: Hungary, Part 8

Hungary features a temperate climate that is very favorable for growing different hay seeds. The forage plant market in the country contributed EUR 119 million to the agriculture sector in 2019, with exports and domestic sales showing a significant increase in the last 4-5 years. However, the growth of the alfalfa market has been slow in recent years and the underdeveloped infrastructure has not helped farmers increase their production. The prices for fertilizers, pesticides and herbicides, machine fuel, and transportation have also remained high for the vast majority of farmers. Climate change and water supply issues are by far the biggest threats that can impact the hay market in Hungary. Experts have even predicted that the weather anomalies caused by the eventual shift in climate will have a big economic impact on the fodder and feed market. On the other hand, the competitive prices for Hungarian forage products could potentially open them to export opportunities towards some of the biggest importers of hay products, namely Saudi Arabia and China. All the information has been included in the attached spreadsheet. 