Stronger domestic demand is pushing prices for DDGS FOB ethanol plants $2/MT higher this week. Merchandisers report that buying interest from the cattle feeding industry for the fall is increasing and supporting values. Rail-delivered DDGS prices are up $6-7/MT for spot/fall delivery. Kansas City soymeal prices, up $4.30/MT, continue to rally and help support DDGS and other feedstuff markets. DDGS are priced at 113 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 0.41, below both last week’s value and the three-year average.
On the export market, asking prices continue to firm as increasing domestic demand is tightening near-term supplies. Offers for DDGS Barge CIF NOLA are up $1-2/MT for September/October delivery while FOB Gulf offers are up $4-5/MT. Prices for 40-foot containers to Southeast Asia are down slightly this week, averaging $237/MT. Exporters note that destination markets have recently been trading at a discount to replacement values as inventories were secure at lower prices. Industry sources say that once those lower priced inventories clear, export demand will be price supportive.