DDG Weekly Update

DDG Prices Steady to Higher

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DTN's average weekly spot price for DDG was higher the past week at $108 per ton. (DTN file photo by Elaine Shein)

The DTN average DDG spot price was $3 per ton higher for the week ended Oct. 27 at $108 with price hikes ranging from $2 to $13 per ton. Of the 37 locations from which DTN collects spot prices, 20 showed an increase, one was lower than the prior week, and the balance of the prices were unchanged. Merchandisers noted that due to the spike in soymeal the past week, DDG prices firmed as well. Domestic demand is picking up and according to one merchandiser, since DDG are a good value currently compared to other feed ingredients, inclusion rates are higher.

CIF NOLA (New Orleans, Louisiana) prices were higher for the week ended Oct. 27 with October prices up ten cents to up 2 cents vs. one week ago and are at 150. The Nov/Dec bids were up 14 cents to up 7 cents vs. one week ago and are at 152 to 155. Informa Economics reported, "There were more export buyers looking to get supplies on its way to Vietnam to insure supplies get under the December cutoff before fumigation regulations change." Last week, Vietnam, the third top importer of U.S.DDG, announced it would suspend imports of U.S. DDG in mid-December because of contamination from the "Ballion" variety of beetle. Deputy Agriculture Minister Le Quoc Doanh said in the directive that inspection of incoming U.S. cargos of DDG will be tighter ahead of the suspension date.

For the first eight months of 2016, Vietnam has already imported close to 687,700 metric tons of U.S. DDG with expectations imports could reach 1 million metric tons this year. When imports to China stalled, Vietnam absorbed some of that lost business. The U.S. Grains Council reported to attendees of the 2016 Export Exchange this past week that they are hopeful the suspension will not take place. Should the suspension happen, the domestic market could become burdened with too much supply, which in turn could cause lower prices.

The value of DDG relative to corn for the week ended Oct. 27 was higher at 84.59% vs. 83.76% the prior week and the value of DDG relative to soybean meal was lower at 32.97% vs. 34.47% the prior week. The cost per unit of protein for DDG was higher at $4.32 vs. $4.20 the prior week, compared to the cost per unit of protein for soybean meal which was higher at $6.90 vs. $6.41 the prior week.

CURRENT PREVIOUS
COMPANY STATE 10/27/2016 10/20/2016 CHANGE
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $120 $120 $0
Modified $63 $63 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $115 $102 $13
Indiana Dry $110 $108 $2
Iowa Dry $107 $100 $7
Michigan Dry $120 $120 $0
Minnesota Dry $98 $95 $3
North Dakota Dry $100 $90 $10
New York Dry $130 $130 $0
South Dakota Dry $95 $90 $5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $110 $110 $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $110 $115 -$5
Iowa Dry $100 $95 $5
Michigan Dry $112 $112 $0
Minnesota Dry $95 $95 $0
Missouri Dry $115 $115 $0
Ohio Dry $115 $115 $0
South Dakota Dry $95 $95 $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $118 $115 $3
Wet $40 $40 $0
Illinois Dry $125 $120 $5
Nebraska Dry $118 $115 $3
Wet $40 $40 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $115 $115 $0
Indiana Dry $112 $110 $2
Iowa Dry $105 $105 $0
Michigan Dry $118 $115 $3
Minnesota Dry $95 $95 $0
Nebraska Dry $100 $100 $0
New York Dry $130 $130 $0
North Dakota Dry $105 $105 $0
Ohio Dry $110 $110 $0
South Dakota Dry $95 $95 $0
Wisconsin Dry $102 $102 $0
Valero Energy Corp., San Antonio, TX (402-727-5300)
Indiana Dry $105 $100 $5
Iowa Dry $100 $95 $5
Minnesota Dry $98 $90 $8
Nebraska Dry $105 $100 $5
Ohio Dry $125 $120 $5
South Dakota Dry $95 $90 $5
California $165 $163 $2
Western Milling, Goshen, California (559-302-1074)
California Dry $175 $165 $10
*Prices listed per ton.
Weekly Average $108 $105 $3
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.

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VALUE OF DDG VS. CORN & SOYBEAN MEAL
Settlement Price: Quote Date Bushel Short Ton
Corn 10/27/2016 $3.5750 $127.68
Soybean Meal 10/27/2016 $327.60
DDG Weekly Average Spot Price $105.00
DDG Value Relative to: 10/27 10/20
Corn 84.59% 83.76%
Soybean Meal 32.97% 34.47%
Cost Per Unit of Protein:
DDG $4.32 $4.20
Soybean Meal $6.90 $6.41
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/)

Mary Kennedy

Mary Kennedy
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