Sorghum Market Trends

By Mathew Trewin
17^th February 2025

Sorghum harvest in northern New South Wales and Southern Queensland continues to impress with reports of excellent yields and quality. Yields in the double digits have been reported in some areas, while elsewhere 6-7 tonnes per hectare is common. Coming on top of outstanding winter crop results, many growers are faced with decisions about their marketing program and managing on farm storage. Some early selling this year of wheat and barley has slowed while the attention has turned to harvesting and marketing sorghum. Domestic buyers in northern markets are also fairly complacent having secured sufficient wheat and barley stocks for the time being.  The prospect of another abundant year is good, with sub soil moisture profiles giving confidence. It is hard to believe that planting in northern districts could only be six weeks away.  It is certainly a different market to last year, where stocks were drawn north to support the livestock industry and underscored stronger prices. The opposite is true this year, where the pull is to the south. Overall, this has left markets stable, albeit a bit lacklustre, with growers weighing up whether to pick up their marketing program now, or risk holding large stock levels as the new crop profile develops. Focus will increasingly turn to international conditions, especially as a blast of winter in the Northern Hemisphere plays out on their crops. Of course, the spectre of geopolitical tensions is looming large. It has been an event filled month for geopolitics with the commencement of the Trump Presidency. There has been a flurry of Executive Orders, including the imposition of tariffs on a number of countries and commodities. The intention of these tariffs and how they play out remains to be seen. The United States is still a major exporter of agricultural products and international markets remain important for the prosperity of the farm sector. As big as America is, it cannot absorb all its farm products domestically.  According to the statistics from the American Farm Bureau, the US sold many billions of dollars of agricultural products to Mexico, Canada and China. At the same time, the United States imports a large percentage of potash, a key ingredient in fertiliser, from Canada. Trade is inherently global and while there may be disruptions, there is usually a work around. This is worth keeping in mind with the latest tensions in Europe as talks start on ending the Ukraine war. After the initial spikes in commodity prices associated with the commencement of the war, markets normalised. Output responds to demand so global supply increased and the down phase proceeded. As they say, the best cure for high prices is high prices. Global trade remains resilient despite geopolitical machinations and supply chain disruptions. Previous fears that disruptions would interrupt food security, did not materialise, as new trade flows eventuated.