DTN Distillers Grain Weekly Update

By Mary Kennedy
DTN Cash Grains Analyst

The DTN average weekly DDG spot price was unchanged for the week ended August 25 at $122 per ton. Of the 37 locations DTN collects spot prices from, eight showed increases of $2 to $5 from last week, five locations reported decreases of $5 and the balance of the prices were unchanged. A trader told DTN that prices are steady to higher as there seems to be more demand this week than last and there is more interest in export tons this week, which also has helped demand.

Other traders told DTN it was a very quiet week with DDG price movement flat to a little firmer across the board with most plants well sold in the nearby and prices are flat through December as well. Another trader added that prices were steady this week as domestic demand continues to be good thanks to cooler weather helping to bump domestic consumption while exports remain steady.

Some of the buying interest seen the past week is also due to buyers squaring positions ahead of month end. Spot prices could remain firm through next week ahead of the Labor Day weekend.

CIF NOLA bids were steady to higher Thursday compared to one week ago with August unchanged at $167 and September up 2 cents to unchanged at $161 to $167 per ton. Informa Economics reported Wednesday that results of an investigation by China into imports of U.S. distiller’s dried grains is expected to come soon from the Chinese Commerce Ministry, according to signals from U.S. trade and industry sources. "The investigation this time, as it did in 2010, resulted in a downturn in U.S. DDG shipments to China. USDA data indicate DDG exports to China dropped 25% between September 2015 and June 2016. But the U.S. industry opted to expand their export efforts to other markets, resulting in a 6% rise in total U.S. DDG exports over that period. The decline in U.S. DDG prices has helped make U.S. supplies more competitive on the world market, helping to offset the impacts from a fall in the level of U.S. DDG exports to China. However, it’s not clear the rise in shipments has made up for the value downturn in the shipments to China. Given that U.S. ethanol producers have access to corn priced cheaper than domestic Chinese supplies available to their ethanol producers, U.S. DDGs are still competitive in the Chinese market."

The value of DDG relative to corn for the week ending August 19 was higher vs. the prior week at 105.60% and the value of DDG relative to soybean meal was higher at 37.62% vs. 36.97% last week. The cost per unit of protein for DDG was unchanged at $4.88, compared to the cost per unit of protein for soybean meal at $6.83, which was lower vs. the prior week of $6.95.

CURRENT PREVIOUS
COMPANY STATE 8/25/2016 8/18/2016 CHANGE
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $135 $135 $0
Modified $65 $65 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $135 $140 -$5
Indiana Dry $130 $130 $0
Iowa Dry $115 $120 -$5
Michigan Dry $135 $135 $0
Minnesota Dry $115 $115 $0
North Dakota Dry $110 $115 -$5
New York Dry $125 $125 $0
South Dakota Dry $110 $115 -$5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $120 $120 $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $125 $125 $0
Iowa Dry $115 $115 $0
Michigan Dry $120 $120 $0
Minnesota Dry $110 $110 $0
Missouri Dry $135 $135 $0
Ohio Dry $130 $130 $0
South Dakota Dry $110 $110 $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $118 $118 $0
Wet $40 $40 $0
Illinois Dry $145 $145 $0
Nebraska Dry $118 $118 $0
Wet $40 $40 $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $130 $125 $5
Indiana Dry $125 $120 $5
Iowa Dry $115 $115 $0
Michigan Dry $125 $120 $5
Minnesota Dry $110 $105 $5
Nebraska Dry $112 $110 $2
New York Dry $125 $120 $5
North Dakota Dry $115 $115 $0
Ohio Dry $125 $120 $5
South Dakota Dry $110 $105 $5
Wisconsin Dry $115 $115 $0
Valero Energy Corp., San Antonio, TX (402-727-5300)
Indiana Dry $130 $130 $0
Iowa Dry $110 $110 $0
Minnesota Dry $110 $110 $0
Nebraska Dry $115 $115 $0
Ohio Dry $130 $130 $0
South Dakota Dry $105 $110 -$5
California $185 $185 $0
Western Milling, Goshen, California (559-302-1074)
California Dry $185 $185 $0
*Prices listed per ton.
Weekly Average $122 $122 $0
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 8/25/2016 $3.2350 $115.54
Soybean Meal 8/25/2016 $324.30
DDG Weekly Average Spot Price $122.00
DDG Value Relative to: 8/26 8/18
Corn 105.60% 102.20%
Soybean Meal 37.62% 36.97%
Cost Per Unit of Protein:
DDG $4.88 $4.88
Soybean Meal $6.83 $6.95

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

Follow her on Twitter @MaryCKenn

(CZ\SK)