Ethanol Blog

California Drought Could Bring Down DDGS Demand

Cheryl Anderson
By  Cheryl Anderson , DTN Staff Reporter

If drought continues to affect California farmers, demand for dried distillers grains with solubles from the Midwest could fall as a result, according to an article by Missouri Farmer Today (http://bit.ly/…).

The West Coast drought could likely decrease dairy production, as large dairies such as those in California require large amounts of water to operate. This could lead to several possible outcomes: increased demand for Midwest dairy products, expansion of Midwest dairies or relocation of dairies from California to areas with more water supplies, such as the Midwest.

California's demand for forages rose with the continued drought; however, demand for DDGS could fall. Since many California dairies buy DDGS from the Midwest, decreased dairy production could limit DDGS shipments to West Coast areas.

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

(ES)

Comments

To comment, please Log In or Join our Community .

Jay Mcginnis
8/24/2015 | 1:25 PM CDT
Id like to know how the entire region of food production can be ripped out and food/commodity prices stay the same?