North Carolina Turfgrass – Grady Miller, Professor Turfgrass Management, Crop and Soil Sciences, North Carolina State University

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In March 2022, North Carolina State University conducted the seventh annual survey to examine the inventory and pricing of North Carolina sod.

Overview

• The supply of bermudagrass sod is similar to 2021, with most suppliers reporting adequate supplies for their expected demand in 2022. There may be some shortages.
  
• The supply of zoysiagrass is expected to be worse in 2022 compared to 2021, with 67% of the producers expecting shortages.
  
• Half the producers expected shortages in St. Augustinegrass in 2022, and one-third predicted shortages of centipedegrass sod.
  
• No shortages for tall fescue and Kentucky bluegrass sod were predicted for 2022.
  
• Prices have increased for all the turfgrass species, and producers expect additional increases in 2022. Tall fescue and Kentucky bluegrass had the biggest price increases (24%) from 2021. The warm-season species, bermudagrass had a 23% price increase and zoysiagrass had a 16% increase.
  
• There was a 23% increase in growers reporting that they grew proprietary grasses and a 4% increase in certified sod growers.
  
• Production acreage was projected to increase in 2022.
  
• The primary market for North Carolina sod producers continues to be landscape contractors, comprising 74% of sod sales.
  
• There was an 8% reduction in the average number of full-time employees per producer.
  
• Total sod sales were reported to be 20% higher than the previous year.
  

Survey Details

Twenty-two producers who represent the following farm sizes completed the anonymous online survey:

• Under 200 acres (nine participants)
  
• 201 to 500 acres (six participants)
  
• 501 to 800 acres (four participants)
  
• Greater than 800 acres (three participants)
  

The North Carolina Sod Producers Association (NCSPA) records suggest that the number of completed surveys represents about 52% of the sod farms in North Carolina. The number of farms with the respective farm sizes suggests that the survey represents the majority of the sod production acreage in the state.

Inventories

We obtained inventory estimates for bermudagrass, zoysiagrass, centipedegrass, St. Augustinegrass, tall fescue, and Kentucky bluegrass, as well as a tall fescue and Kentucky bluegrass mix. These estimates were based on estimated sales and the availability of sod that is excellent (more than 10% of demand), adequate (equal to demand), or poor (more than 10% shortage).

Pricing information included the farm price as well as the price for truckload orders delivered to the closest urban market or within 100 miles of the farms. All costs were reported as price per square foot of sod. 

Bermudagrass is being grown by 19 (86%) of the surveyed producers. This is currently the most popular turfgrass species grown by North Carolina sod producers. Fifty-eight percent of these producers rated their inventory as adequate this year, and 10% indicated that their inventory was excellent. More than 50% of producers projected inventory levels of bermudagrass as good during the last six years (Figure 1).

Zoysiagrass is being grown by 15 (68%) of the surveyed producers, which made it the second most popular turfgrass species grown by North Carolina sod producers. Thirty-three percent of these producers rated their inventory as adequate this year, although no producer indicated that it was excellent. For 2022, 67% of all zoysiagrass producers projected shortages, which was similar to 2021 estimates. Over the last six years, the percentage of producers reporting good inventory levels peaked in 2019 and has declined since then (Figure 1).

Of the producers surveyed, 13 (59%) are growing centipedegrass. Fifty-four percent of these growers reported that they had adequate to excellent inventory. Thirty-one percent of all centipedegrass growers anticipate a shortage during 2022.

Six (27%) of the surveyed producers are growing St. Augustinegrass. Fifty-percent of these growers reported adequate inventory, but 50% anticipated a shortage during 2022.

Eight (36%) of the producers are growing tall fescue. Seventy-five percent estimated that they would have adequate to excellent inventory, and 25% anticipated a shortage for 2022. For the last five years, more than 70% of producers reported good inventory levels of tall fescue (Figure 1).

A mixture of tall fescue and Kentucky bluegrass is being grown by 6 (27%) of the surveyed producers. Sixty-seven percent of these producers rated their inventory as adequate to excellent this year and 33% anticipated shortages.

Two producers surveyed (9%) reported growing Kentucky bluegrass. Of the two who responded to this survey, one anticipated an adequate supply during 2022, while one anticipated a shortage.

Pricing

Table 1 provides sod prices for all grass species in 2022. Prices shown include purchased on-the farm and delivered.

The average price per square foot was $0.37 for a truckload of bermudagrass sod at the farm and $0.38 delivered to the closest urban market or within 100 miles of the farm. The farm price ranged from $0.23 to $0.47, while delivered prices ranged from $0.29 to $0.54. The average on-farm prices for bermudagrass increased by 7 cents per square foot compared to 2021, which was a 23% increase.

Zoysiagrass on-farm prices in 2022 ranged from $0.37 to $0.70 per square foot, and averaged $0.52 per square foot. This was the highest value turfgrass sold by North Carolina growers. The average price delivered to an urban market or within 100 miles of the farm was $0.54 and ranged from $0.36 to $0.77. The average on-farm price of zoysiagrass increased by 16% from 2021.

Centipedegrass prices in 2021 ranged from $0.19 to $0.42 per square foot and averaged $0.30. The price, when delivered, ranged from $0.22 to $0.42 and averaged $0.34. The average on-farm prices for centipedegrass increased 3% from 2021.

St. Augustinegrass prices in 2022 ranged from $0.43 to $0.52 per square foot and averaged $0.48. The price, when delivered, ranged from $0.46 to $0.59 and averaged $0.52. St. Augustine on-farm prices in 2022 were 7% higher than in 2021.

Tall fescue prices in 2022 ranged from $0.27 to $0.56 per square foot and averaged $0.41. The price, when delivered, ranged from $0.36 to $0.56 and averaged $0.44. The average on-farm price of tall fescue in 2022 increased 24% from 2021.

The mix of tall fescue and Kentucky bluegrass sod prices in 2022 ranged from $0.36 to $0.45 per square foot and averaged $0.42. The price, when delivered, ranged from $0.36 to $0.56 and averaged $0.44. The on-farm prices increased by 20% compared to 2021.

Kentucky bluegrass sod prices reported in 2022 were $0.45 per square foot by both sod farms. The price, when delivered, ranged from $0.49 to $0.52 and averaged $0.51. This is a 2% decrease in the on-farm price compared to 2021.

Figure 2 provides a six-year perspective of sod prices that shows fluctuations of particular species since 2017. The data represent the average price. The percentage change reported for each grass compared to the previous year was: bermudagrass, 23%; zoysiagrass, 16%; centipedegrass, 3%; St. Augustinegrass, 7%; tall fescue, 24%; tall fescue + Kentucky bluegrass, 20%; and Kentucky bluegrass, -2%. There were consistent price increases across all the major turfgrasses grown in North Carolina. Kentucky bluegrass prices were stable, although only two sod growers reported sales of this grass.

Projected Price Increases

Most of the growers in the survey forecasted increased sod prices in 2022. A few producers predict steady prices for particular grasses. The percentages of producers with expectations for price changes in each grass were:

• Bermudagrass – 78% expect price increases, 22% expect prices to remain steady, none expect prices to decrease
  
• Zoysiagrass – 79% expect price increases, 21% expect prices to remain steady, none expect prices to decrease
  
• Centipedegrass – 92% expect price increases, 8% expect prices to remain steady, none expect prices to decrease
  
• St. Augustinegrass – 60% expect price increases, 40% expect prices to remain steady, none expect prices to decrease
  
• Tall fescue – 71% expect price increases, 29% expect prices to remain steady, none expect prices to decrease
  
• Tall fescue + Kentucky bluegrass – 29% expect price increases, 71% expect prices to remain steady, none expect prices
  
  to decrease
  
• Kentucky bluegrass – 100% expect prices to remain steady.
  

Proprietary Grass

In 2022, 59% of the surveyed growers reported that they grew some proprietary grasses on their farm. This is a 23% increase from 2021. The average percentage of their grasses that were proprietary was 30% with a reported range from 1% to 82%.

Certified Grass

In 2022, 50% of the growers surveyed grew some certified sod. This was a 4% increase from 2021. The average amount of certified grass reported by these farmers was 59% of their total sod acreage. Forty-four percent of these producers charged higher prices for certified grass—$0.02 to $0.04 more per square foot.

Freight

Delivery charges were based on a flat rate for 54% of respondents and a per mile basis for 46%. Freight rates per mile shipped to the closest urban market ranged from $4.00 to $7.00 per mile and averaged $4.61 per mile, which was a 9.8% increase from the previous year. Six sod farms reported flat freight rates of $175 to $300 per shipment with a mean of $215, although these rates could vary depending on other factors such as distance from farm. Fifty-four percent of the respondents indicated that freight prices are included in the price quotes to customers, while 46% invoiced the freight charges separately.

No respondents charge an unloading fee. Eighty-six percent of respondents make additional drops on loads. The low-end charge for additional drops on a load was $25, the high-end charge was $150, and the average cost for additional drops was $70. Several respondents reported that the charge depended on the distance between drops, and that charges can be divided between buyers. Some also added a minimum drop fee (such as $25) plus a mileage rate (for instance $4.00 per mile).

Fuel Surcharge

Fourteen percent of respondents added a fuel surcharge. Relative fuel prices each year seem to influence this practice.

Price Changes

When asked how often producers adjust their sale prices, 55% indicated that they adjust their prices yearly, while 45% make adjustments as needed. No producers adjust their prices quarterly or monthly.

Credit Card Convenience Fee

Twenty-seven percent of respondents charged a convenience fee for credit card purchases. This is an 8% increase compared to 2021.

Sales by Industry Segments

Table 2 shows the industry segments where sod is sold. The producers estimated that landscape contractors constituted the largest segment with 74% of their sales. The next highest group was homeowners at 8.9%, followed by sports/athletics and golf courses with 6.4% and 5.9%, respectively. Retail garden centers were 2.5% and brokers 2.3%. The largest changes compared to previous years were the 19% increase in landscape contractor sales, the 44% decrease in direct homeowner sales, and the 22% decrease in sales to golf courses.

Acreage in Production

A total of 9% indicated that they reduced sod production acreage during 2021. The average decrease was 6%. No producer expected to reduce production in 2022. One hundred percent of the growers indicated that they had increased acres during the previous three years. The average percentage of increase in acreage was 26%. The percentage of respondents who expected to increase production acreage in 2022 was 19% greater than in 2021.

Employees

Several questions about the number of employees and sod sales were added to this year’s survey. These data were collected as a requirement for the North Carolina Department of Agriculture and Consumer Services grant that was awarded to NCSPA.

The average number of full-time employees at these sod production operations was 12, which represents an 8% decrease from 2021. Of the 22 operations that responded, the number of full-time employees ranged from 2 to 75. The average number of seasonal employees ranged from zero to 20, with an average of 3, which is a same as 2021.

Total Sod Sales

Total sod sales for the 20 operations that reported data ranged from $85,000 to $6 million. The average sod sales were $1.648 million (a 20% increase from the previous year’s values). Total sod sales reported were $32,968,466. Eighty-two percent of the producers indicated their sales increased in 2021, 5% had a decrease, and 13% reported sales remained the same.

Summary

The last year saw the third consecutive year of growth in the sod industry after several years of reducing acreage due to poor sod sales. In all species but one, there were increases in sod prices, with most having moderate increases. The primary lawn grasses (tall fescue, bermudagrass, and zoysiagrass) had price increases from 16% to 24%. New home construction remained strong in 2021 and into 2022, which drove high demand. The COVID-19 pandemic continues to disrupt the supply chain and trucking. A strong house construction market will continue to provide a great need for North Carolina sod in 2022, which is important since the bulk of sod sales (74%) are now to landscape contractors. The total acreage of sod appears steady with a small amount of growth. Shortages of warm-season grasses, especially bermudagrass, zoysiagrass, and St. Augustinegrass, are projected in 2022. Most producers expect sod prices to increase in 2022.

AG-809 Publication date: May 2022

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