Stronger domestic demand is pushing prices for DDGS FOB ethanol plants higher this week. Kansas City soymeal prices, up $2.50/MT, are also helping support the DDGS market as soymeal futures rallied sharply Wednesday and Thursday. DDGS are priced at 115 percent of cash corn values, down from the prior week and above the five-year average ratio of 109 percent. The DDGS/soymeal price ratio is 0.43, above both last week’s value and the three-year average.
The domestic DDGS market is stronger this week with increased usage from the livestock industry and supplies remaining below year-ago levels. DDGS merchandisers report that the domestic/export price spread has narrowed in recent weeks and fall/winter domestic demand is appearing, which will support prices going forward.
On the export market, asking prices are higher this week but exporters report buyers are remaining patient so far. Sources note a few DDGS combo vessels have been traded this week but markets have been quiet otherwise. Barge CIF NOLA offers are up $12/MT for September positions while October/November offers are up $7-8/MT. FOB NOLA offers are $8-9/MT higher this week with rail delivered DDGS rising $8/MT as well. Offers for 40-foot containers to Southeast Asia are mostly steady/slightly lower this week, averaging $240/MT.