Ethanol Blog

With plentiful supplies of dried distillers grains and a lack of domestic interest, prices of DDG continued their nearly two-month downward fall.

The DTN weekly DDG spot price average fell another $4 per ton this week, from $230 per ton to $226. This marks the eighth consecutive week that the average decreased, falling a total of $39 per ton during that time. This is also the lowest price level the average has reached since late June 2012 when the average was $230 per ton.

Of the 28 Midwestern locations DTN collected prices from this week, 18 locations reported their spot prices had decreased in the past week between $3 and $10 per ton. Prices remained the same as last week in 10 locations, and no price increases were reported.

Merchandisers told DTN that prices saw more weakness in the Midwest, while more eastern States such as Indiana, Ohio and Michigan were more stable. Ample supplies of DDG and a lack of domestic interest in some areas acted to pressure price down.

Seasonal changes when more cattle are back on pasture and off feedlots helped keep demand lower as well.

The value of DDG relative to corn fell slightly from 92.33% to 91.12%, marking about two weeks that the value has finally fallen under 100% to a more competitive level. The value of DDG relative to soybean meal also fell, from 54.95% last week to 51.35% this week.

The cost per unit of protein for DDG was actually less than the cost for soybean meal this week, at $9.04. The cost per unit of protein for soybean meal was $9.27.

Cheryl Anderson can be reached at Cheryl.anderson@telventdtn.com.