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 domestic dried distillers grains was up $2 at $155 per ton, while export prices were weaker. (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 $155 for the week ended March 22, up $2 on average versus a week ago. Prices collected by DTN were mixed and some merchandisers have noted that DDG bids for April are up to $5 per ton lower in some locations.

Based on the average of bids collected by DTN, the value of DDG relative to corn for the week ended March 22 was at 115.43%, and the value of DDG relative to soybean meal was at 42.12%. The cost per unit of protein for DDG was $5.74, compared to the cost per unit of protein for soybean meal at $7.75. With lower soybean meal prices this week, the difference in cost on a per protein unit narrowed between DDG and soybean meal.

The U.S. Grains Council (USGC) said in its weekly price update that barge CIF NOLA and FOB NOLA prices were lower. "Falling barge freight rates and relatively firmer Gulf values have increased netbacks for firms able to ship on the river," according to merchandisers.

"On the export market, merchandisers are reporting a slow tone to the market, with Savanah, Georgia, and Chicago distillers dried grains with solubles (DDGS) prices $5/metric tons (mt) lower. Low pork production margins in Vietnam are reportedly slowing DDGS purchases from that nation. Prices to Southeast Asia were $3/mt lower on average this week," added USGC.

The DDGS market, along with other commodities, received some troubling news March 23 about new tariffs on China imports. In a press release, U.S. Grains Council President and CEO Tom Sleight issued a statement on China tariffs and concern over retaliation. "While we are not surprised, we are dismayed at new tariffs announced today by the Trump administration against China, which will almost certainly prompt immediate and painful retaliation against U.S. agriculture, and which have already complicated our global efforts to promote sales of U.S. grains and grain products.

"The farmers and exporters we represent have been here before in our relationship with China. Since 2010, we have been adversely impacted by trade policy actions by China against U.S. distiller's dried grains with solubles (DDGS), sorghum, ethanol and corn."

Here is a link to the full statement: https://grains.org/…

CURRENT PREVIOUS CHANGE
COMPANY STATE 3/22/2018 3/15/2018
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 $160 $160 $0
Indiana Dry $160 $160 $0
Iowa Dry $150 $150 $0
Michigan Dry $160 $160 $0
Minnesota Dry $150 $150 $0
North Dakota Dry $155 $155 $0
New York Dry $170 $170 $0
South Dakota Dry $150 $150 $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $155 $155 $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $160 $165 -$5
Iowa Dry $145 $145 $0
Michigan Dry $160 $165 -$5
Minnesota Dry $145 $145 $0
Missouri Dry $165 $160 $5
Ohio Dry $160 $165 -$5
South Dakota Dry $145 $145 $0
` `
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $160 $160 $0
Wet $55 $50 $5
Illinois Dry $170 $170 $0
Nebraska Dry $160 $160 $0
Wet $55 $50 $5
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $160 $160 $0
Indiana Dry $155 $155 $0
Iowa Dry $145 $145 $0
Michigan Dry $150 $150 $0
Minnesota Dry $145 $145 $0
Nebraska Dry $150 $150 $0
New York Dry $165 $165 $0
North Dakota Dry $155 $155 $0
Ohio Dry $155 $155 $0
South Dakota Dry $145 $145 $0
Wisconsin Dry $150 $150 $0
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
Indiana Dry $167 $145 $22
Iowa Dry $148 $140 $8
Minnesota Dry $145 $145 $0
Nebraska Dry $150 $145 $5
Ohio Dry $165 $145 $20
South Dakota Dry $147 $140 $7
California $215 $215 $0
Western Milling, Goshen, California (559-302-1074)
California Dry $226 $228 -$2
*Prices listed per ton.
Weekly Average $155 $153 $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 3/22/2018 $3.7600 $134.29
Soybean Meal 3/22/2018 $368.00
DDG Weekly Average Spot Price $155.00
DDG Value Relative to: 3/22 3/15
Corn 115.43% 110.77%
Soybean Meal 42.12% 41.24%
Cost Per Unit of Protein:
DDG $5.74 $5.67
Soybean Meal $7.75 $7.81
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

(BAS/CZ)

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