California climate laws create ripple effects for farmers in the Sorghum Belt
My longtime readers know I’m not a big fan of government red tape. But whether we like it or not, two new laws out of California — Senate Bills 253 and 261 — are about to make waves far beyond their borders. And yes, that means even here in the Sorghum Belt.
SB 253 and 261 require companies doing business in California to disclose their greenhouse gas emissions (Scope 1, 2 and 3 for SB 253) and climate-related financial risks (SB 261). On the surface, these bills target major corporations. But as with so many things in agriculture, the impact will cascade down the supply chain.
The key practical point to remember is that Scope 3 emissions include the upstream and downstream activities of companies. This means everything from the production of fertilizer to how much diesel was used to harvest a crop to the carbon footprint of the grain being bought. For example, if a company is buying sorghum from a farmer in Kansas or Texas and selling food products in California, these new rules mean that company may soon be asking some pointed questions about how that grain was grown.
These could include questions like “What kind of nitrogen did you use?” “What were your tillage practices?” and “How much irrigation water was applied?”
And these aren’t just polite curiosities. They’re compliance requirements. If a food company can’t account for those emissions, they risk running afoul of California law and facing fines. So naturally, they’ll look to shift the burden downstream. And this won’t just affect products. Food use still comprises a very small portion of overall sorghum demand, so the impacts felt most broadly in sorghum country will be those on crop inputs, where costs associated with additional reporting are ultimately passed along to farmers.
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My longtime readers also know I’m a big proponent of sustainability. I’ve spent a good part of my career making the case that farmers — especially sorghum farmers — are already doing more with less. Sorghum uses one-third less water than corn, often needs less nitrogen per bushel, and has a lower overall greenhouse gas footprint per bushel in many cases. Truly, it is the resource-conserving crop. So, if companies are looking for ways to reduce emissions on paper, our crop is a great place to start.
But we all know how these things play out in practice. New rules lead to new paperwork requirements. And new paperwork requirements trigger the need for new reporting platforms, third-party verifiers and consultants who have never stepped foot on a farm. And all of these things cost money — more than the vast majority of sustainability program premiums, if such premiums exist at all. In the case of California, there is no premium. This all-stick-no-carrot approach is where my concerns lie.
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To make matters worse, these mandates are being pushed at the same time the federal government is backing off similar rules. The U.S. Securities and Exchange Commission recently softened its climate disclosure requirements after significant industry pushback. And we all know where the Trump administration stands on these issues overall. But California is doubling down, and since its economy is the fourth largest in the world, companies can’t exactly ignore it. So, where do we go from here?
The good news is there’s a silver lining. It’s that sorghum has a chance to lead. We know our crop is good for the land. We know it’s good for farmers. And now, with the right data, we can show it’s good for the environment, too. That makes it incredibly valuable to companies navigating this regulatory maze.
We don’t have to love these new rules. I don’t, and to be frank, much of my business revolves around helping farmers and companies comply with them. But if we’re smart, we can position sorghum as a part of the solution. And not just because it checks a sustainability box, but because it’s already delivering the sustainability outcomes these laws require.