Market Matters Blog

MINNEAPOLIS (DTN) -- The DTN average price for domestic distillers dried grains (DDG) from 33 locations reporting for the week ended June 29 was $203 per ton, down $5 on average from one week ago. DDG prices were pressured by the recent drop in corn prices. The DTN National Corn Index has dropped 96 cents since one week ago. Lower soybean meal prices also added to weakness in DDG prices.

The Energy Information Administration (EIA) at midweek showed overall ethanol production in the United States averaged 1.052 million barrels per day (bpd), unchanged week-on-week, and 1,000 bpd, or 0.1% higher than in the same week last year. Four-week average output at 1.039 million bpd was 12,000 bpd below the same four weeks in 2022. Midwest ethanol production averaged 991,000 bpd, up 1,000 bpd week-on-week and 1,000 bpd, or 0.1% higher than in the same week last year. Four-week average output at 981,000 bpd was 11,000 bpd below the same four weeks in 2022.

Based on the average of prices collected by DTN, the value of DDG relative to corn for the week ended June 29 was 0.98%. The value of DDG relative to soybean meal was 50.37 and the cost per unit of protein for DDG was $7.52 compared to the cost per unit of protein for soybean meal at $8.48.

In its weekly DDGS export update, the U.S. Grains Council said: "Barge CIF NOLA DDGS offers are $15 metric ton (mt) lower this week amid steady barge freight and falling offers for product destined for the river system. Traders are closely watching water levels and draft restrictions along the Mississippi River for possible impacts on the market. FOB NOLA offers are lower as well but are seeing greater support than the barge market due to navigation difficulties on the river. FOB NOLA offers for July are down $4 mt at $276 this week while deferred positions are down $2 to $3 mt. U.S. rail rates are down $18 to $20 mt for July-September positions while offers for 40-foot containers to Southeast Asia are down $15 mt at $315 for July shipment."

The Lower and Upper Mississippi River continue to experience low water conditions. The Mississippi River at Memphis is at -4.79 feet below zero gauge and rain is expected to boost it to -3.4 feet, but unless rains are steady it is expected to reach -8.3 feet below zero gauge by July 13. Barge traffic is moving but in recent weeks has been slowed by groundings and dredging operations at various locations from St Louis to New Orleans. Tow sizes have been reduced and barge drafts reduced to 9 feet from St Louis and 10 feet from Cairo.

NOTE: All prices listed below can change at any time and are subject to confirmation from sellers.

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

Follow her on Twitter @MaryCKenn

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