DDGS Weekly Market Report – February 2, 2023

DDGS values are $5-7/MT higher this week as domestic demand remains strong and export interest is staring to increase. Additionally, the week-long rally in soymeal futures has helped support feedstuff values across the board. Brokers note that river values and export offers are higher this week as firms work to pull product away from the domestic and container markets.

The DDGS/Kansas City soymeal ratio is at 0.52 this week, down from last week and above the three-year average of 0.50. The DDGS/cash corn ratio edged higher this week to 1.10, equal to last week’s value and above the three-year average of 1.06.

Brokers have also cited a “thin pipeline” as responsible for increases in DDGS values on the export market. Barge CIF NOLA offers are up $7-10/MT this week while FO BNOLA offers are up $9 for spot positions and up $1-7/MT for March/April. Offers for 40-foot containers to Southeast Asia are up $20/MT for February/March positions at $414 this week.

The USDA’s monthly Grain Crushings report helped explain some of the recent pricing strength in DDGS markets, as production fell sharply in December 2022. The industry produced 1.523 MMT (1.68 million short tons) in December, which was down 5.6 percent from November and down 19 percent year-over-year. Part of the production decline is explained by bitter cold temperatures and icy conditions that hampered operations towards the end of the month. The weather also contributed to an 11.4-percent year-over-year decline in corn gluten feed production as well as a 6.9 percent decrease in corn gluten meal output.