Market Matters Blog

OMAHA (DTN) -- The domestic distillers dried grains (DDG) average spot price from the 40 locations DTN contacted remained firm this week versus the prior week, at $133 per ton for the week ended June 6.

Based on the average of prices collected by DTN, the value of DDG relative to corn for the week ended June 6 was at 88.56% and is below the five-year average. The value of DDG relative to soybean meal was at 42.10%. The cost per unit of protein for DDG was $4.93, compared to the cost per unit of protein for soybean meal at $6.65.

Ethanol supply in the U.S. was slightly lower in the week ended May 31, while production and blending demand fell to the lowest level in nearly a month, according the Wednesday, June 5, Energy Information Administration report. EIA reported ethanol plant production fell 13,000 barrel per day (bpd) to 1.044 million bpd, the lowest level since the week ended May 3.

In its weekly update, the U.S. Grains Council noted that DDGS indications were higher this week. "DDGS indications for FOB vessel Gulf are higher this week ($218 per metric ton for July delivery) as buyers wait for corn and soybean futures to settle. Merchandisers report that the bid-offer spread is aligning and expect Asian buyers to reenter the market soon. Otherwise, DDGS indications were mostly up. Indications for 40-foot containers to Southeast Asia increased $9/mt, on average, with Myanmar seeing the largest jump from last week's figure."

The U.S. Census Bureau said Thursday U.S. exports of DDGS totaled 917,836 mt in April, down from 956,828 mt in March and down 8% from a year ago. Mexico was the top destination in April, taking 20% of U.S. exports, followed by South Korea, Vietnam, Thailand and Canada. In the first four months of 2019, U.S. exports of DDGS were down 7% from a year ago.

It is still difficult for transport downriver to the Gulf, as flooding the past three months has delayed or stopped barges from getting there. The Upper Mississippi River is closed above St. Louis with nearly all the locks closed, along with the USACE St. Paul District with continued dredging above Lock and Dam 11. In addition, the St. Louis Harbor remains closed as the river continues to rise there, with June 17 being the soonest opening predicted. The Lower Mississippi River below St. Louis is open, but flooding continues in the Gulf with up to another 6 inches of rain expected there in the next few days.

**

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

Follow her on Twitter @MaryCKenn

(AG)

© Copyright 2019 DTN/The Progressive Farmer. All rights reserved.