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Double‐cropping sorghum [Sorghum bicolor (L.) Moench] with winter rye (Secale cereale L.) could increase annual dry matter production in the North‐Central region of the USA and reduce soil erosion and other environmental concerns. We conducted this study to compare yield, chemical composition, erosion potential, and economics of sorghum grown continuously (sole crop), in a 3‐yr rotation with maize (Zea mays L.) and soybean [Glycine max (L.) Merr.], or double‐cropped with winter rye (rye‐sorghum). The experiment was on a Typic Calciaquoll soil in central Iowa with a slope of less than 1% and on mixed Vertic Argiaquoll, Typic Hapludoll, and Aquertic Argiudoll soils in southern Iowa with 2 to 7% slope. Applied N moderately affected sole‐cropped sorghum, with yields of 13.5, 16.1, 16.9, and 15.9 t ha−1 when fertilized with 0, 70, 140, and 280 kg ha−1 N, respectively. Rye‐sorghum was highly responsive to N, with combined yields at 72, 84, 95, and 110% of sole‐cropped sorghum fertilized with the same annual rate of N. Drought dramatically reduced rye‐sorghum yields. Sole‐cropped sweet sorghum had yields similar to sweet sorghum grown in the 3‐yr rotation. Environmental conditions associated with years and locations affected fiber components, N, and total nonstructural carbohydrate concentrations of sorghum. Use of the Universal Soil Loss Equation revealed that planting rye before sorghum would reduce estimated soil loss at both locations, but the loss was still unacceptably high on the sloping soil in southern Iowa (22 t ha−1). An economic partial budget showed that ryesorghum cost $147 ha−1 more to produce than sole‐cropped sorghum. We conclude that, if winter rye is to be grown as a double crop with sorghum in the North‐Central region, it will likely be because of its positive influence on the environment and not because of potential for improved yield.

The expected utility maximization problem is solved for producers with both price and production uncertainty who have access to both futures and options markets. Introduction of production uncertainty alters the optimal futures and options position and almost always makes it optimal for the producer to purchase put options and to underhedge on the futures market. Simulation results lend support to the practice of hedging the minimum expected yield on the futures market and hedging remaining expected production against downside price risk using put options. The results are strengthened if the producer expects local production to influence national prices and if risk aversion is higher at low income levels.

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