DDG Weekly Update

DDG Prices Steady Prior to China's Ruling

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DTN's average weekly spot price for DDG was unchanged at $116 the past week. (DTN file photo by Elaine Shein)

The DTN average DDG spot price was unchanged for the week ended Sept. 22 at $116 per ton. Of the 37 locations from which DTN collects spot prices, two showed slight decreases from the prior week, four showed increases and the balance of the prices were unchanged. A merchandiser told me this is the "heart" of fall maintenance, and it will likely last through the first week of October. Some areas where shutdowns have been taking place did show stronger prices because of the lack of spot supplies.

CIF NOLA prices were higher to unchanged for the week ended Sept. 22 with September prices steady to up 2 cents at $152 to $158 versus the prior week of $150 to $159 per ton, and October steady to up 3 cents at $153 to $158 per ton. Informa Economics did report, "Buying interest for export movement through container yards was stronger as traders were trying to get supplies moving before October and the potential for higher freight rates." Rail tariff rates usually rise in October every year at the start of fall harvest.

In a late development early Friday, Sept. 23, China's Ministry of Commerce, in a preliminary ruling, said the U.S. was dumping distillers dried grains in China, damaging the domestic industry, and will require them to pay a duty. Dow Jones reported that, starting Friday, importers are expected to provide a deposit to the customs in accordance to each company's dumping profit margin, which stands at 33.8%. The ministry didn't say when it would issue a final decision. A DDG broker told me that many exporters had already slowed or stopped their DDG shipments to China since the start of the investigation in January, expecting a duty that would be retroactive to shipments in route.

U.S. Grains Council issued a statement saying, "We are confident that U.S. DDGS are not being dumped and are not causing or threatening injury to Chinese producers. Our industry deeply appreciated the support that we received at the recent hearing in China from our Chinese customers, and we remain hopeful that MOFCOM will find in its final determination that continued access for U.S. DDGS is in China's interest." Here is a link to their full statement: https://goo.gl/…

The value of DDG relative to corn for the week ending Sept. 22 was lower at 96.45% vs. $100.12% the prior week and the value of DDG relative to soybean meal was lower at 37.67% vs. 38.24% the prior week. The cost per unit of protein for DDG was lower at $4.64, compared to the cost per unit of protein for soybean meal at $6.48, which was 2 cents lower versus the prior week of $6.50.

CURRENT PREVIOUS
COMPANY STATE 9/22/2016 9/15/2016 CHANGE
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $125 $125 $0
Modified $65 $65 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $125 $125 $0
Indiana Dry $125 $120 $5
Iowa Dry $115 $115 $0
Michigan Dry $135 $130 $5
Minnesota Dry $105 $105 $0
North Dakota Dry $110 $110 $0
New York Dry $145 $130 $15
South Dakota Dry $105 $105 $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $120 $118 $2
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $125 $125 $0
Iowa Dry $115 $115 $0
Michigan Dry $120 $120 $0
Minnesota Dry $110 $110 $0
Missouri Dry $130 $130 $0
Ohio Dry $125 $125 $0
South Dakota Dry $110 $110 $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $125 $125 $0
Wet $40 $40 $0
Illinois Dry $135 $135 $0
Nebraska Dry $125 $125 $0
Wet $40 $40 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $120 $120 $0
Indiana Dry $120 $120 $0
Iowa Dry $112 $110 $2
Michigan Dry $120 $120 $0
Minnesota Dry $102 $105 -$3
Nebraska Dry $108 $105 $3
New York Dry $135 $135 $0
North Dakota Dry $105 $105 $0
Ohio Dry $120 $120 $0
South Dakota Dry $100 $100 $0
Wisconsin Dry $112 $115 -$3
Valero Energy Corp., San Antonio, TX (402-727-5300)
Indiana Dry $115 $115 $0
Iowa Dry $105 $105 $0
Minnesota Dry $105 $105 $0
Nebraska Dry $110 $110 $0
Ohio Dry $125 $125 $0
South Dakota Dry $100 $100 $0
California $170 $170 $0
Western Milling, Goshen, California (559-302-1074)
California Dry $180 $175 $5
*Prices listed per ton.
Weekly Average $116 $116 $0
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.
VALUE OF DDG VS. CORN & SOYBEAN MEAL
Settlement Price: Quote Date Bushel Short Ton
Corn 9/22/2016 $3.3675 $120.27
Soybean Meal 9/22/2016 $307.90
DDG Weekly Average Spot Price $116.00
DDG Value Relative to: 9/22 9/15/2016
Corn 96.45% 100.12%
Soybean Meal 37.67% 38.24%
Cost Per Unit of Protein:
DDG $4.64 $4.72
Soybean Meal $6.48 $6.50
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 25.

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

Follow her on Twitter @MaryCKenn

(CZ/SK)

Mary Kennedy

Mary Kennedy
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