CME Launches Sorghum Basis Futures Contracts to Mitigate Price Volatility

The Chicago Mercantile Exchange (CME) Group has launched sorghum basis futures contracts, which started trading on August 24, 2026. The new contract reflects the price difference between sorghum and corn, two types of grain used in animal feed and ethanol production.

According to John Ricci, managing director and global head of agricultural products at CME Group, 'While sorghum prices tend to track corn closely over extended macroeconomic cycles, geopolitical events and regional supply shifts can disrupt that relationship.'

The contracts will be physically delivered from a network of elevators in Kansas, the largest sorghum-producing state. The delivery points are located within the switching limits of major cities including Kansas City, Hutchinson, Salina/Abilene, and Wichita.

This is not the first attempt to launch sorghum futures contracts. In the 1970s, grain sorghum contracts were tried at both the Chicago Board of Trade (CBOT) and Kansas City Board of Trade (KCBT), but failed to gain traction. KCBT relaunched a 'redesigned' contract in May 1989, only to delist it in December 1999 due to liquidity issues.