Market Matters Blog

DDG Prices Higher on Average

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DTN's average weekly spot price for DDG was up $1, at $97 per ton. (DTN file photo by Elaine Shein)

The DTN average dried distillers grains, or DDG, spot price was up $1 from two weeks ago, at $97, for the week ended May 25. Of the 39 locations from which DTN collects spot prices, eight bids were $3 to $8 higher, one bid was $4 lower, and the balance of the prices were unchanged.

The value of DDG relative to corn, based on those bids for the week ended May 25, was at 73.55%, and the value of DDG relative to soybean meal was at 31.83%. The cost per unit of protein for DDG was at $3.88, compared to the cost per unit of protein for soybean meal, at $6.41. The DDG relative price to corn and soybean meal futures continues to be lower and more competitive versus historical levels.

Merchandisers noted that prices in the Midwest have been firm on steady movement of supply. Prices have moved a little higher on some pre-holiday trading to ensure needs are covered before the Memorial Day weekend. Informa Economics reported that the holiday-shortened workweek next week could have some local price volatility, but given sufficient supply, prices are apt to remain range bound, absent a significant change in runtimes.

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CIF NOLA (New Orleans, Louisiana) dried distillers grains with solubles, or DDGS, prices for the week ended May 25 were at $131 to $136, and June prices were at $128 to $133. Traffic on the Mississippi River has been slowed again as high-water conditions still exist. Upper Mississippi from St. Louis to Cairo is above flood stage, and traffic is moving with safety protocols in place. Tow sizes have been reduced by five to 10 barges and restricted to daylight transit only. The Lower Mississippi River from Cairo to New Orleans is at or near flood stage and tow sizes are reduced, and in some areas are restricted to daylight transit only. The Mississippi River in Baton Rouge is expected to crest at its highest level in six years on May 30, hitting 41 feet. The last time the river crested at 41 feet or higher was in 2011 when it crested at 45 feet. Major flood stage is 40 feet. Both barge and ocean vessel traffic is moving, but safety protocols will be in place at least into June.

U.S. Grains Council (USGC) reported Thursday that despite market challenges, the latest U.S. Department of Agriculture (USDA) trade data show exports of U.S. distillers dried grains with solubles (DDGS) have remained steady due to attractive prices, available supply and market development efforts by the Council among a diversity of buyers. "From September 2016 to March 2017, USDA reported the United States exported 6.9 million metric tons of DDGS, a 6% increase year-over-year. This steady pace of exports occurred even with a dramatic drop in purchases from the largest player in the past few marketing years, China."

CURRENT PREVIOUS CHANGE
COMPANY STATE 5/11/2017 5/11/2017
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $120 $120 $0
Modified $60 $60 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $95 $95 $0
Indiana Dry $95 $95 $0
Iowa Dry $92 $92 $0
Michigan Dry $90 $90 $0
Minnesota Dry $90 $90 $0
North Dakota Dry $90 $90 $0
New York Dry $130 $130 $0
South Dakota Dry $90 $90 $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $98 $98 $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $110 $105 $5
Iowa Dry $98 $98 $0
Michigan Dry $110 $102 $8
Minnesota Dry $96 $96 $0
Missouri Dry $112 $112 $0
Ohio Dry $110 $105 $5
South Dakota Dry $96 $96 $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $103 $103 $0
Wet $45 $45 $0
Illinois Dry $105 $105 $0
Nebraska Dry $103 $103 $0
Wet $45 $45 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $100 $100 $0
Indiana Dry $90 $90 $0
Iowa Dry $95 $95 $0
Michigan Dry $95 $95 $0
Minnesota Dry $85 $85 $0
Nebraska Dry $99 $95 $4
New York Dry $120 $120 $0
North Dakota Dry $95 $92 $3
Ohio Dry $94 $98 -$4
South Dakota Dry $85 $85 $0
Wisconsin Dry $95 $90 $5
Valero Energy Corp., San Antonio, TX (402-932-5901)
Indiana Dry $95 $90 $5
Iowa Dry $90 $90 $0
Minnesota Dry $90 $90 $0
Nebraska Dry $95 $95 $0
Ohio Dry $100 $95 $5
South Dakota Dry $80 $80 $0
California $160 $152 $8
Western Milling, Goshen, California (559-302-1074)
California Dry $168 $166 $2
*Prices listed per ton.
Weekly Average $97 $96 $1
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.
VALUE OF DDG VS. CORN & SOYBEAN MEAL
Settlement Price: Quote Date Bushel Short Ton
Corn 5/25/2017 $3.6925 $131.88
Soybean Meal 5/25/2017 $304.70
DDG Weekly Average Spot Price $96.00
DDG Value Relative to: 5/25 5/11
Corn 73.55% 74.56%
Soybean Meal 31.83% 30.85%
Cost Per Unit of Protein:
DDG $3.88 $3.84
Soybean Meal $6.41 $6.65
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 25.

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

Follow her on Twitter @MaryCKenn

(BAS/AG)

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