30 Oct Why You Should Be Growing Sorghum In 2021
Sorghum prices have been strong since spring 2020 because of China buying U.S. sorghum. Many growers are starting to think about what that might mean for the 2021 growing season since crop decisions start now for 2021. If 2014-2015 is any indication of what might happen this time around, it could shape up to be a great year to be “in” on sorghum.
In August of 2014, sorghum prices were about 105% of corn prices, so $0.10 to $0.15 per bushel. At that time, the Chinese were also the ones driving the market. By April and May of 2015, the price differential had grown to as much as $1.00 per bushel in southern locations with quick ocean access like the Mississippi Delta and South Texas. Even in the Kansas sorghum prices were higher than corn during this time. As we look ahead, new crop prices for 2021 delivery in South Central Kansas are now $0.45 higher than corn, $0.35 in NW KS, and over $1.00 near Corpus Christi, TX. Of course, determining if these prices will hold is subject to the whims of the market.
If we use South Central Kansas as an example, we can quickly see how growing sorghum has an economic advantage over other crops. Take Kansas State University’s Ag Manager crop budget data (www.agmanager.info) and the prices mentioned above, we can see that sorghum has advantages over the other crop choices in the area with over $100 per acre net returns (Figure 1). The primary advantage sorghum has over other crops besides the strong price is in seed costs. Based on our scenarios, sorghum has $30 lower seed cost per acre than corn and soybean and a staggering $80/acre difference compared with cotton. Many of the other costs align with the other crops because most field operations are similar and apart from soybeans, the herbicide and fertilizer costs are similar across crops.
We all know that when we have years like this where a crop has a big shift in acres, access to seed becomes an issue. There should be plenty of seed available but getting the best hybrids may require you to make some early decisions. Early decisions also allow for better pricing because most companies offer discounts for early decisions that can get passed up through their dealer and retail networks.
If you are unsure of what sorghum hybrids to plant, Sorghum Partners SP 68M57 is widely adapted and has excellent yield potential in most environments from South Texas up through Nebraska. SP 43M80 is a tough, drought tolerant, medium-early hybrid with excellent SCA tolerance. SP 43M80 is suited for most dryland fields in the Central and Western Plains. For short season environments farther north, SP 31A15 and SP 25C10 are great hybrids to consider.