Market Matters Blog

DDG Prices Higher

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DTN's average weekly spot price for DDG was 2 cents higher at $126 per ton, as demand remains strong. (DTN file photo by Elaine Shein)

OMAHA (DTN) -- The DTN average dried distillers grains (DDG) spot price from the 39 locations DTN collects bids from was $126 for the week ended Nov. 30, 2 cents higher from two weeks ago.

Based on the average of bids collected by DTN, the value of DDG relative to corn for the week ended Nov. 30 was at 103.23%, and the value of DDG relative to soybean meal was at 38.83%. The cost per unit of protein for DDG was $4.67, compared to the cost per unit of protein for soybean meal at $6.83. Price wise, DDG still remains a good choice for feed inclusion over soymeal.

Cold weather demand and a shortened holiday week were responsible for the uptick in prices again this week. Merchandisers noted demand keeps rising in certain rail markets, most notably for delivery to the Pacific Northwest and California as well as for shipments to Mexico.

The U.S. Grains Council (USGC) reported in their weekly price update that prices at the U.S. Gulf firmed slightly from the prior week. Containers to Asia were mixed, with increases seen for Indonesia, Malaysia and Japan and decreases for containers to the Philippines and Bangladesh. Merchandisers also reported an uptick in interest from Korea, Indonesia and Vietnam.

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DDGS NEWS

Ecuador's imports of U.S. distillers grains with solubles (DDGS) increased 296% year over year to 22,200 metric tons in 2016/2017, the direct result of the U.S. Grains Council's work to introduce the feed grains co-product to the nation's livestock sector, according to the weekly USGC newsletter.

The Ecuadorian government has a corn self-sufficiency policy, effectively meaning any product labeled with the word "corn" in its description is subject to import restrictions into the country. However, in the past few years, the local corn crop has not been enough to cover domestic demand, resulting in expensive prices for local corn and the government issuing limited import permits.

However, U.S. DDGS is still allowed to be imported into Ecuador and is still a relatively undervalued feed ingredient in this market. To seize this potential demand, the council conducted a series of activities to introduce DDGS to the industry. The council noted it will continue supporting increased use of DDGS in Ecuador by executing additional programs to provide nutritional information to livestock producers in the poultry, dairy and beef sectors.

CURRENT PREVIOUS CHANGE
COMPANY STATE 11/30/2017 11/16/2017
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $140 $132 $8
Modified $70 $68 $2
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $122 $122 $0
Indiana Dry $122 $122 $0
Iowa Dry $123 $120 $3
Michigan Dry $115 $112 $3
Minnesota Dry $125 $125 $0
North Dakota Dry $140 $135 $5
New York Dry $132 $132 $0
South Dakota Dry $135 $135 $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $135 $130 $5
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $122 $125 -$3
Iowa Dry $120 $120 $0
Michigan Dry $122 $125 -$3
Minnesota Dry $120 $120 $0
Missouri Dry $135 $135 $0
Ohio Dry $122 $125 -$3
South Dakota Dry $130 $130 $0
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United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $140 $140 $0
Wet $60 $60 $0
Illinois Dry $140 $140 $0
Nebraska Dry $140 $140 $0
Wet $60 $60 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $122 $120 $2
Indiana Dry $112 $110 $2
Iowa Dry $120 $118 $2
Michigan Dry $112 $110 $2
Minnesota Dry $118 $115 $3
Nebraska Dry $135 $135 $0
New York Dry $130 $125 $5
North Dakota Dry $145 $130 $15
Ohio Dry $115 $115 $0
South Dakota Dry $120 $120 $0
Wisconsin Dry $120 $115 $5
Valero Energy Corp., San Antonio, TX (402-932-5901)
Indiana Dry $120 $120 $0
Iowa Dry $120 $115 $5
Minnesota Dry $120 $120 $0
Nebraska Dry $130 $130 $0
Ohio Dry $130 $130 $0
South Dakota Dry $110 $110 $0
California $195 $188 $7
Western Milling, Goshen, California (559-302-1074)
California Dry $210 $206 $4
*Prices listed per ton.
Weekly Average $126 $124 $2
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 11/30/2017 $3.4175 $122.05
Soybean Meal 11/30/2017 $324.50
DDG Weekly Average Spot Price $126.00
DDG Value Relative to: 11/30 11/16
Corn 103.23% 103.18%
Soybean Meal 38.83% 39.94%
Cost Per Unit of Protein:
DDG $4.67 $4.59
Soybean Meal $6.83 $6.54
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 27.

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

Follow Mary Kennedy on Twitter @MaryCKenn

(AG)

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