Market Matters Blog

OMAHA (DTN) -- The DTN average dried distillers grains spot price (DDG) from the 39 locations DTN collects bids from, was $110 for the week ended Aug. 10, unchanged on average from one week ago.

Based on the average of those bids collected by DTN, the value of DDG relative to corn for the week ended Aug. 10 was at 84.21%, and the value of DDG relative to soybean meal was at 37.39%. The cost per unit of protein for DDG was $4.07, compared to the cost per unit of protein for soybean meal at $6.19.

Merchandisers told DTN that prices are steady and a little weaker in spots. But, so far, the losses in the cash corn price this week haven't had a big impact on prices.

Informa Economics noted that, "Prices have been range-bound in previous weeks, but expect to see a little more volatility in the coming weeks as more contracts are typically executed coupled with the USDA forecasting production above previous expectations for corn and soybeans. Expect prices to remain mostly range-bound outside of some large deviation in corn or soybean meal prices. With strong demand paired with higher USDA forecast prices, expect prices to trade near the softer end of the range."

CIF NOLA (New Orleans, Louisiana) dried distillers grains with solubles, or DDGS, prices for August are at $143 to $149, and August-September are at $143 to $149. U.S. Grains Council (USGC) noted that as the marketing year for corn comes to an end, they have been seeing increased demand for U.S. DDGS as a result of price and efforts to promote the product in a diverse set of markets.

"Sales of U.S. DDGS dropped significantly from the two largest traditional markets -- China and Vietnam," said the council. "While this void had a substantial impact, it left ample supply for other world buyers to purchase -- and USGC programs throughout the world are helping end-users learn how to incorporate U.S. DDGS into their rations.

"As a result, overall purchases are only just behind last year's export pace at 9.32 million tons," said USGC. "In contrast, exports to Mexico, this year's top market, are up 9% year-over-year to 1.69 million tons. Turkey now ranks as the second-largest market for U.S. DDGS with exports that nearly doubled year-over-year to 1.11 million tons, the largest amount since the country started purchasing DDGS in 2004/2005. U.S. DDGS exports to South Korea and the European Union also set new sales records at 847,000 tons and 792,000 tons, respectively."

Mary Kennedy can be reached at Mary.Kennedy@dtn.com

Follow her on Twitter @MaryCKenn

(AG)

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