Market Matters Blog

DDG Prices Sharply Lower

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DTN's average weekly spot price for domestic distillers dried grains was $11 lower at $160 per ton. (DTN file photo by Elaine Shein)

OMAHA (DTN) -- The average distillers dried grains (DDG) spot price from the 39 locations DTN contacted was $160 per ton for the week-ended June 7, $11 lower versus one week ago.

Merchandisers noted that it was "time" for prices to move lower seasonally, along with the lack of fresh news, especially with recent hopes fading that China may adjust the stiff penalties currently placed on U.S. DDGS imports. DDG prices have been strong for the majority of 2018. But, as summer arrives and with no positive news coming out of China as the trade war continues, markets are moving lower. Also, recent losses in corn and soymeal prices are putting pressure on the market as well.

Based on the average of prices collected by DTN, the value of DDG relative to corn for the week-ended June 7 was at 119.07%, and the value of DDG relative to soybean meal was at 44.64%. The cost per unit of protein for DDG was $5.93, compared to the cost per unit of protein for soybean meal at $7.55.

In their weekly price update, U.S. Grains Council (USGC) reported: "On the export market, Barge CIF NOLA and FOB U.S. Gulf values are lower, with a larger drop in the latter squeezing netbacks to merchandisers. Rising freight rates have kept prices for containerized DDGS shipped CNF to Southeast Asia more stable this week. In sympathy with lower soybean meal values, exporters lowered asking prices for product destined for Southeast Asia approximately $7 per metric ton." (CNF is similar to CIF only insurance is not included)

The U.S. Census Bureau said Wednesday that U.S. exports of DDGS totaled 997,633 metric tons (mt) in April, up 15% from a year ago. Mexico was the top export destination again in April, accounting for 18% of the total and followed by Vietnam, South Korea and Thailand. In the first four months of 2018, U.S. DDGS exports were down 7% versus one year ago.

ALL PRICES SUBJECT TO CONFIRMATION CURRENT PREVIOUS CHANGE
COMPANY STATE 6/7/2018 5/31/2018
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $170 $175 -$5
Modified $85 $88 -$3
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $172 $180 -$8
Indiana Dry $165 $174 -$9
Iowa Dry $160 $170 -$10
Michigan Dry $165 $175 -$10
Minnesota Dry $155 $170 -$15
North Dakota Dry $155 $170 -$15
New York Dry $170 $175 -$5
South Dakota Dry $160 $165 -$5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $158 $160 -$2
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $175 $180 -$5
Iowa Dry $165 $170 -$5
Michigan Dry $175 $180 -$5
Minnesota Dry $160 $170 -$10
Missouri Dry $175 $185 -$10
Ohio Dry $175 $180 -$5
South Dakota Dry $160 $170 -$10
` `
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $158 $162 -$4
Wet $40 $50 -$10
Illinois Dry $172 $181 -$9
Nebraska Dry $158 $162 -$4
Wet $40 $50 -$10
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $165 $175 -$10
Indiana Dry $160 $175 -$15
Iowa Dry $145 $160 -$15
Michigan Dry $155 $170 -$15
Minnesota Dry $140 $165 -$25
Nebraska Dry $140 $150 -$10
New York Dry $165 $180 -$15
North Dakota Dry $145 $165 -$20
Ohio Dry $160 $170 -$10
South Dakota Dry $145 $160 -$15
Wisconsin Dry $145 $170 -$25
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
Indiana Dry $165 $180 -$15
Iowa Dry $160 $170 -$10
Minnesota Dry $160 $170 -$10
Nebraska Dry $140 $170 -$30
Ohio Dry $165 $180 -$15
South Dakota Dry $165 $165 $0
California $220 $234 -$14
Western Milling, Goshen, California (559-302-1074)
California Dry $230 $238 -$8
*Prices listed per ton.
Weekly Average $160 $171 -$11
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 6/7/2018 $3.7625 $134.38
Soybean Meal 6/7/2018 $358.40
DDG Weekly Average Spot Price $160.00
DDG Value Relative to: 6/7 5/31
Corn 119.07% 121.52%
Soybean Meal 44.64% 45.56%
Cost Per Unit of Protein:
DDG $5.93 $6.33
Soybean Meal $7.55 $7.90
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

(BAS/AG)

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