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Mailing Address:  P. O. Box 2265, Granby, CO 80446-2265
Office:  97 Forrest Drive, Granby, Colorado
Tel: 970-887-3759 ∙ Cell:  307-760-2922 ∙ Cell: 307-760-6890
e-mail:  pedersenplanning@gmail.com

Project Experience

Location: Big Horn, Park, Washakie and Hot Spring Counties, Wyoming
Client: Big Horn County
P.O. Box 31, Basin, Wyoming 82410
Contact: Linda Harp, Project Manager
Year Completed: July 2006
Project Scope:

Pedersen Planning Consultants was obtained to examine the feasibility of developing an alfalfa processing business enterprise in Greybull, Wyoming.  The feasibility study evaluated and available hay production within a 4-county study area, identified potential domestic and international markets, and determined start-up costs and working capital requirements for the establishment, operation and maintenance of an alfalfa processing facility and related production equipment. 

3400 Series Bale Compression System
Photo credit: Steffen Systems

PPC initially examined the capability of the alfalfa growers in the four-county area surrounding the City of Greybull (Big Horn, Park, Washakie, and Hot Spring Counties, Wyoming).  Historical production data was examined to determine recent alfalfa production volumes and market prices.  Available data was supplemented with a survey to 429 alfalfa producers in this four county area.  Responses to this survey provided insights concerning the motivation of alfalfa growers to provide alfalfa hay to the compressed hay operation, as well as more specific information concerning potential volumes that might be available, the type of bales produced. 

PPC examined the domestic and international dairy markets, as well as domestic horse hay markets.  Through the application of GIS software, available data sets each of these markets were analyzed and segmented in order to identify the more attractive geographical market areas.  Seventeen market destinations in the continental United States and several Far East ports were identified and analyzed in order to compare the transportation costs involved in delivering compressed bales of alfalfa to these markets. Rail, shipping and trucking rates were obtained to determine the most economically efficient method to deliver the product to the end user.  PPC also determined costs associated with the construction of a production site and facility, the purchase of bale compression equipment and other operational equipment, labor, and marketing.  Potential market costs of compressed alfalfa bales were calculated through a review of regional market price data. 

Anticipated costs and revenue assumptions were input into a statistical model that generated profit-loss and cash flow statements and cash flow projections for the proposed alfalfa compression operation.  The model was used to compare four different marketing scenarios.  Each scenario emphasized a specific, but unique combination of potential market channels for the sale of compressed alfalfa hay.  This approach enabled PPC to determine the most promising market strategy in terms of potential return-on-investment to the proposed business.