DDGS Weekly Market Report – October 29, 2020

U.S. DDGS values continue to firm, supported by steady domestic demand and year-over-year declines in ethanol and DDGS production. FOB ethanol plant DDGS prices are up $5/MT this week and are trading at their highest values since May.  The DDGS/corn ratio stands at 119%, up from last week and above the three-year average of 109%. Kansas City soymeal values are down $10/MT this week as CBOT futures retreat from their recent rally. DDGS are valued at 43% of Kansas City soymeal, up from last week and above the three-year average of 42 percent.

After rallying sharply last week, Barge CIF NOLA prices are giving back some of those gains. The recent tightness in export logistics pushed CIF NOLA rates higher and squeezed export margins. This week’s move lower in Barge CIF NOLA rates is seen as a move to increase netbacks to exporters. Spot rates for CIF NOLA DDGs are down $13/MT while deferred positions are down $20/MT.

FOB Gulf DDGS prices are weaker as well, with November trading down $9/MT but deferred positions down only $5-7/MT. U.S. rail logistics remain tight amid a full export pipeline for corn and soybeans amid this year’s harvest. Rail rates for DDGs are up $3-4/MT on average this week. Finally, 40-foot containers to Southeast Asia are up $10/MT this week, averaging $295/MT.