Market Matters Blog

The DTN average dried distillers grains, or DDG, spot price was unchanged from one week ago, at $92, for the week ended March 30. Of the 39 locations from which DTN collects spot prices, five bids were $5 higher, one bid was $5 lower and the balance of the prices were unchanged.

The value of DDG relative to corn for the week ended March 30 was at 72.05% and the value of DDG relative to soybean meal was at 29.21%. The cost per unit of protein for DDG was at $3.68 compared to the cost per unit of protein for soybean meal which was at $6.63.

Merchandisers told DTN that there is no new demand for DDG and a few plants are filling up with product as ethanol plant production hasn't slowed. The U.S. Energy Information Administration reported Wednesday that plant production last week was up 1%, the highest since the week-ended Feb. 3.

Even with expectations for output to decline slightly in the next few weeks as plants take their scheduled downtimes, it won't offer much support to prices given temperatures are warming up and pastures are greening. Seasonal slowdowns and the fact that there are plenty of other feed ingredients around, will likely keep some pressure on prices for now.

CIF NOLA (New Orleans, Louisiana) dried distillers grains with solubles, or DDGS, prices for the week ended March 30 were up 1 cent to up 2 cents for March compared to last week, at $121 to $125 per ton and up 1 cent for April at $121 to $124. Without some of the larger Asian export buyers in the market, prices are apt to remain "range bound," according to Informa Economics.

U.S. grain farmers are voicing their support and appreciation for trade with Mexico, a message U.S. Grains Council Chairman and Maryland farmer Chip Councell gave when he traveled to meet with Mexican buyers in March.

"If you look at the logistics of Mexico, no other country can replace it as a customer for U.S. grain," Councell said this week to the National Association of Farm Broadcasting about the mission.

"The logistics by rail, truck and boat give the United States such a huge advantage."

Mexico is now the largest market for U.S. corn, with 13.3 million metric tons (523.6 million bushels) of imports in 2015/2016, as well as the second-largest customer for U.S. DDGS with 2015/2016 imports of 1.9 million metric tons.

"I think it is extremely important that our friends in Mexico know that U.S. producers are advocating for agriculture," Councell said in the March 30 USGC Global Update.

"USGC has been working in Mexico for over 35 years to help them build their industry, and it is too important to ignore."

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow Mary Kennedy on Twitter @MaryCKenn

(TN)

© Copyright 2017 DTN/The Progressive Farmer. All rights reserved.