High grain sorghum prices may help offset year’s drought

ORIGINALLY WRITTEN
Producers are taking advantage of high grain prices this year. Tim Lust, chef executive officer of the National Sorghum Producers, feels that several factors are responsible for this year’s market scenario.

“The combination of Spain and Mexico’s export demand bidding against our domestic ethanol and feed industries has grain sorghum trading strong and even at a premium to corn in many markets across the country,” Lust said.

One year ago, milo was selling for $1.43 per bushel at Cooperative Grain & Supply based in Hillsboro. Last week’s price was $3.33.

NSP President Greg Shelor of Minneola said, “I had the best contract I have ever had for grain sorghum. Prices like this help to make up for drought.”

A decrease in acreage combined with low yields has resulted in a short supply this year.

According to projections released by the National Agricultural Statistics Service in October, the United States is expected to harvest about 400,000 fewer acres than last year with a production decrease of almost 93 million bushels or 25 percent of last year’s crop.

Though Mexico remains the dominant U.S. sorghum importer, Spain has made an aggressive entrance into the market recently to fulfill annual commitments made two decades ago.

Lust said that through negotiations of the Uraguay Round of The General Agreement on Tariff and Trade (GATT), Spain is still a market player today.

“Past NSP President Mabry Foreman of Felt, Okla., worked to ensure that grain sorghum had a place in the agreement,” he said.

“Today, producers are still benefiting from that work. They may not know the contributing factors to today’s high grain prices, but producer support of NSP 20 years ago is paying big dividends today.”

A growing domestic ethanol market is also contributing to the spike in demand for all feed grains. Many ethanol plants are being built in the U.S. Sorghum Belt.

NSP represents U.S. sorghum producers. Headquartered in Lubbock, Texas, NSP includes the heart of the U.S. Sorghum Belt that stretches from the Rockies to the Mississippi River and from South Texas to South Dakota.

The organization works to ensure the profitability of sorghum production through market development, research, education and legislative representation.

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