CME Group to Launch Sorghum Basis Futures | LeapRate
On Tuesday, derivatives marketplace CME Group announced plans to launch Sorghum basis futures, with trading expected to begin on 24 August 2026, pending regulatory review.
Sorghum is a versatile commodity positioned to meet demand from the domestic feed industry, international export markets and, increasingly, biofuels.
The new basis contract reflects the price difference between sorghum and corn, both grains used in animal feed and ethanol feedstock.
A premium for sorghum over corn typically signals international demand driving values higher, while a deep discount encourages domestic buyers to shift feed rations toward cheaper sorghum.
John Ricci, Managing Director and Global Head of Agricultural Products at CME Group, said that while sorghum prices tend to track corn closely over extended macroeconomic cycles, “geopolitical events and regional supply shifts can disrupt that relationship.”
He added that the sorghum-to-corn cash spread has experienced considerable volatility in recent years, swinging from sharp premiums to steep discounts, and that the new futures contract “will provide market participants a precise instrument to hedge that basis risk.”
CME said the contracts will be physically delivered, with grain loaded out by truck or rail from a network of elevators in Kansas, the nation’s largest sorghum-producing state, using the established Kansas City Hard Red Winter Wheat delivery network.
CME Group achieved record quarterly volume of 2.1 million contracts for agricultural products in the second quarter of 2026. Corn futures and options reached record open interest of 4.1 million contracts in the same period, with the second-highest quarterly volumes on record at 695,000 contracts traded.
