US sorghum planting is anticipated to expand notably in the 2021/22 season, with the planted area forecast to reach 2.5 million hectares, up 21.7% y-o-y. This is a far larger percentage increase than soyabean and maize (corn), as high prices for sorghum and the crop’s stronger resistance to drought is encouraging US farmers.
Sorghum prices have rallied over the year, reaching the highest level since August 2012 on 12th May at USD 304/MT, 129% higher compared to the same period in 2020. The price rally was primarily driven by robust Chinese feed grain imports, as the country’s hog herd recovers from the African swine flu (ASF) impacts. In addition, record-high domestic maize prices in China encouraged buyers to source alternative grains for use in feed rations, thus supporting sorghum imports.
According to the USDA, US 2020/21 sorghum exports are likely to reach 7.7 million tonnes (+49.8% y-o-y), the third-largest volume in history and volumes are expected to increase further in 2021/22, to a total of 8.9 million tonnes. China’s imports of the new US sorghum crop have soared by 612,000 tonnes to 917,000 tonnes so far this year, compared to the same time the previous year. However, continued demand from China is uncertain, as the country aims to reduce its reliance on imported grain crops. Also, the current high prices for sorghum could hit the grain’s attractiveness and drive buyers to look for cheaper grain alternatives, thus weighing on sorghum prices.