Ethanol Blog

DDG Prices Rise Amid Some Tightness in Supply

Cheryl Anderson
By  Cheryl Anderson , DTN Staff Reporter

Prices of dried distillers grains rose $4 per ton in the past week due to increased domestic demand and some tightness in supply.

The DTN weekly spot price average rose $4 per ton in the past week, from $144 on July 17 to $148 last Friday. This is the fourth consecutive week the average has increased, from $131 per ton the last week of June to this week's average of $148. This is the highest point the average has reached since early June.

Of the 36 Midwestern locations DTN collects spot prices from, 21 locations reported their spot prices had increased between $3 per ton and $20 per ton in the past week, though most price increases were in the $5- to $10-per-ton range. Prices at 15 locations remained unchanged in the past week and no price decreases were noted.

Merchandisers told DTN this week that plants have been running tight on supplies of DDG. That, coupled with increased domestic demand, left some plants either sold out for the month or some even unable to cover sales.

Also contributing to the shortness in supply may be the fact that freight costs for containers are expected to rise in August, so some may be trying to get product shipped in July before costs increase.

The value of DDG relative to corn in the past week rose from about 94% on July 17 to about 103% on Friday, July 24, as corn prices fell and DDG prices rose. The value of DDG relative to soybean meal rose only slightly, from about 40% to 41% during the same time period.

The cost per unit of protein for DDG was $5.92 this week, compared to the cost per unit of protein for soybean meal at $7.56.

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

(CZ)

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