Ethanol Blog

A quiet week of trade resulted in a continued steady trend in dried distillers grains prices.

The DTN weekly DDG spot price average remained fairly steady, rising just $1 in the past week from $176 per ton to $177. This is the eighth week the average has hovered between $176 and $178 per ton, continuing its steady trend, but it is still at its highest point since mid-June 2014.

Of the 36 Midwestern locations DTN collects spot prices from, 22 locations reported unchanged prices since last week. Prices at 11 locations were $5 per ton higher, while only three locations reported price decreases of $5 each.

Merchandisers described trade in the past week as very quiet, with the market remaining unchanged for the most part. Most companies reported only a few slight adjustments up or down in spot prices, as buyers showed interest, with few actually stepping up to the plate with purchases. Some merchandisers felt a lot of end users may be sitting and waiting to see if prices will decline.

The logistical bottleneck of containers continues in western ports. Although the labor strike in western U.S. ports has been resolved, it may take several months to clear out the backlog that occurred during that time.

One positive note was warmer weather should cause the Mississippi River to thaw and re-open in the next week or so, which should allow product to flow to the Gulf once again.

The value of DDG relative to corn this week remained unchanged at about 129%, while the value of DDG relative to soybean meal rose from about 50% last week to about 53% this week.

The cost per unit of protein for DDG was about $7.08 this week, virtually equal to the cost per unit of protein for soybean meal at $7.04.

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

(CZ)

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