The Prospective Planting report released this week by the Department of Agriculture indicates an 11 percent increase in sorghum acres for 2020, but National Sorghum Producers says there is greater opportunity for increased sorghum acres in the United States for the 2020-2021 marketing year.
When the analysis was conducted in February, sorghum prices did not reflect basis appreciation from export sales that occurred since that time. Significant purchase activity by China, approaching one million metric tons over the last seven weeks, has driven basis improvements, and these purchases account for roughly ten percent of the sorghum produced last year.
Today, sorghum for export commands a 13 percent premium. These gains have been seen at interior country elevators, as well, with new crop basis gains of $0.20-$0.40 in the past two weeks. With these factors in mind, NSP says both domestic and international demand will continue to drive sorghum acres this spring.