A HUGE stockpile of sorghum in the United States and limited import permits for Chinese buyers has led to reduced export demand for Australian sorghum.
Widespread planting of sorghum, coupled with a global market already flooded with feed grain, has led to the market dropping by up to $90 on this time last year.
Sorghum is trading at $250 per tonne delivered to Brisbane and Newcastle, back from $330 or $340/t this time last year, according to AgVantage Commodities broker Sam Clements.
It’s a huge change from last year, when increased export demand led to most of Australia’s 2.2 million tonne crop being bought by China.
“China has a big corn stockpile at the moment so they’re not as interested in sorghum at the moment for stock feed,” Mr Clements said.
“It’s getting to the point where sorghum is probably going into feed rations domestically.”
Nidera Australia trading manager Matthew Pattison, Toowoomba, said this year’s sorghum crop could be as big as last year’s, but traders were still look for markets to sell it into.
”Last year the NSW crop was about 500,000 tonnes and sorghum planting is already further advanced than it was this time last year,” Mr Pattison said.
Mr Pattison said global prices for all grains were significantly lower this year.
“In the past couple of years we’ve had big corn and wheat crops in all major producing areas so global stocks are high,” he said.
“US production of sorghum is up about four to five million tonnes from last year, so that surplus of stock will keep pressure on sorghum values.”
The biggest player in global demand for Australian sorghum, China, is facing import limits.
“This time last year every second phonecall was a Chinese consumer looking to buy sorghum,” Mr Pattison said.
”China in last 12 months has imported in excess of 10 million tonnes of sorghum but that’s come to a screeching halt as the Chinese government makes import permits for sorghum harder to get.
“We will still sell some grain to China but the trade flow will be a trickle rather than the tidal wave of last year.”
Sorghum planting in traditional areas such as the Liverpool Plains began in October, but recent rain has lead to many more farmers being able to plant.
For some, it’s their first sorghum crop for three years.
Gunnedah-based Local Land Services agronomist Bill Manning said most of the state’s sorghum would be planted in the next few weeks.
“Over the last couple of years there haven’t been many opportunities to sow sorghum with the dry conditions, so they’re getting stuck in and getting the sorghum in while they can,” Mr Manning said.
”They can plant up right up to Christmas and people have planted in the new year in the last two years and they’ve done okay.
“The risk is that if you get a wet autumn harvest can drag on for months, particularly on the Liverpool Plains, where the soil holds the moisture and it’s a cooler climate.”
About 40 millimetres of rain over the past month was enough for Bart and Alice Brady to plant 200 hectares of sorghum at “Killarney”, Mullaley.
Mr Brady, who farms alongside his parents Bill and Wendy, finished planting last week after two falls of 33mm and 8mm.
“I was going to put more in but we reduced the size because we haven’t got enough subsoil moisture,” he said.
“I normally try to plant sorghum but I haven’t for the last three summers because it’s just been too dry.
“I was hoping to plant double that, but the moisture wasn’t there and it’s not a good enough market outlook.”
Mr Brady said he wouldn’t look at forward selling just yet, but would wait until harvest.
“We’ll wait and see what the market is like at harvest. There’s still a fair way to go before we make those decisions.”
