The dramatic upsurge in prices of distillers dried grains in recent weeks seemed to have slowed, giving the market a chance to catch-up and readjust.
The DTN weekly spot price average rose another $4 per ton in the past week, from $164 per ton last week to $168 per ton this week. This is the ninth consecutive week the average has increased, rising a total of $52 per ton in that time, from a low of $116 per ton in mid-April to this week's average of $168 per ton. This is the lowest point the average has reached since late May 2015.
Of the 36 Midwestern locations DTN collects spot prices from, a total of 19 reported their prices had increased between $3 and $20 per ton in the past week, although most price increases were in the $5 to $15 per ton range. Prices at 16 locations remained unchanged since last week, while only one location reported a price decrease of $2 per ton.
Merchandisers told DTN this week that a shortage of protein sources for livestock rations still exists in some areas. However, after nearly two months of DDG prices forced skyward from competing corn and especially soybean meal prices, markets seem to be stabilizing and perhaps entering a holding pattern for a bit.
With wheat harvest underway in many wheat-growing states, some logistical issues have arisen as harvesters take up a big share of local trucks.
And of course, the extreme heat and dry weather tends to send chills down the collective backs of those in the markets fearing the ruin of 2016 crops, although some merchandisers reported the nearby market as very good.
The industry still waits with bated breath for the outcome of China's DDG anti-dumping and countervailing duties investigation and the imposition of additional duties on exports to Chinese ports.
The value of DDG relative to corn this week climbed nearly 3%, from about 108% last week to about 111% this week. The value of DDG relative to soybean meal also rose, from about 40% last week to about 42% this week.
The cost per unit of protein for DDG was 16 cents higher this week at $6.72, compared to the cost per unit of protein for soybean meal, which was 34 cents lower at $8.37.
Cheryl Anderson can be reached at Cheryl.firstname.lastname@example.org.
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