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 dried distillers grains was 3 cents higher at $151 per ton, as demand remains firm. (DTN file photo by Elaine Shein)

OMAHA (DTN) -- The average distillers dried grain (DDG) spot price from the 39 locations where DTN collected bids was $151 for the week ended March 1, up 3 cents on average versus a week ago.

Based on the average of bids collected by DTN, the value of DDG relative to corn for the week ended March 1 was at 111.63%, and the value of DDG relative to soybean meal was at 38.32%. The cost per unit of protein for DDG was $5.59, compared to the cost per unit of protein for soybean meal at $8.29.

Merchandisers noted that the strength in domestic prices can be attributed to the continued rise in soybean meal price. This has been a boost for DDG prices as the cost per unit of protein for DDG remains a better value for feeders. Some buyers have turned their nose up at the high cost of DDG, but for the most part, demand remains strong and DDG still has a prominent place in feed inclusion rates.

Barge CIF NOLA (New Orleans, Louisiana) prices were firm as river conditions due to flooding in the Lower Mississippi River have not improved. American Commercial Barge Line noted in their daily river update on March 1 that high water has resulted in reduced tow sizes north- and south-bound and currently only daylight passage is allowed through Memphis and Vicksburg for at least the next few weeks. At the Gulf, Baton Rouge harbor is not expected to crest until 3/21 at 42.5 feet, and New Orleans is not expected to crest until 3/13 at 17 feet. Safety protocols are in place and loadings have been affected by the high water.

The U.S. Grains Council (USGC) said in its weekly price update that year-end data for 2017 revealed U.S. exports of approximately 11 million metric tons to over 50 countries. "Exports in January 2018 were up substantially compared to January 2017, continuing a trend of increasing exports that began in December 2017. Lately, merchandisers report a flurry of interest from especially Asian buyers starting late last week and continuing this week. As such, prices for Asian destinations have firmed up; on average DDGS destined for Southeast Asia increased $6 per metric ton this week from last. Containers to Thailand led the way, up $8."

CURRENT PREVIOUS CHANGE
COMPANY STATE 3/1/2018 2/22/2018
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $170 $170 $0
Modified $85 $85 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $155 $150 $5
Indiana Dry $160 $155 $5
Iowa Dry $145 $140 $5
Michigan Dry $160 $160 $0
Minnesota Dry $145 $140 $5
North Dakota Dry $155 $150 $5
New York Dry $165 $165 $0
South Dakota Dry $145 $140 $5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $150 $155 -$5
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $165 $165 $0
Iowa Dry $142 $142 $0
Michigan Dry $170 $170 $0
Minnesota Dry $142 $140 $2
Missouri Dry $160 $160 $0
Ohio Dry $165 $165 $0
South Dakota Dry $145 $140 $5
` `
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $150 $150 $0
Wet $50 $50 $0
Illinois Dry $168 $155 $13
Nebraska Dry $150 $150 $0
Wet $50 $50 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $155 $150 $5
Indiana Dry $155 $145 $10
Iowa Dry $140 $140 $0
Michigan Dry $150 $150 $0
Minnesota Dry $145 $135 $10
Nebraska Dry $145 $145 $0
New York Dry $165 $165 $0
North Dakota Dry $150 $150 $0
Ohio Dry $155 $150 $5
South Dakota Dry $145 $140 $5
Wisconsin Dry $145 $140 $5
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
Indiana Dry $145 $145 $0
Iowa Dry $140 $135 $5
Minnesota Dry $145 $135 $10
Nebraska Dry $145 $150 -$5
Ohio Dry $145 $145 $0
South Dakota Dry $140 $138 $2
California $215 $215 $0
Western Milling, Goshen, California (559-302-1074)
California Dry $216 $218 -$2
*Prices listed per ton.
Weekly Average $151 $148 $3
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 3/1/2018 $3.7875 $135.27
Soybean Meal 3/1/2018 $394.00
DDG Weekly Average Spot Price $151.00
DDG Value Relative to: 3/2 2/22
Corn 111.63% 112.99%
Soybean Meal 38.32% 39.26%
Cost Per Unit of Protein:
DDG $5.59 $5.48
Soybean Meal $8.29 $7.93
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 her on Twitter @MaryCKenn

(AG)

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