Distillers Dried Grains with Solubles (DDGS)
DDGS Comments: The soybean meal rally plus a hot, dry forecast for the U.S. Midwest continue to push upward pressure in the DDGS market. Ordinarily prices would be headed lower in summer but at times it has hit parity with corn and could be at a peak. However, some buyers are anxiously buying ahead of what some fear will now be a possible weather spike in the market. Meanwhile, and despite hurdles, U.S. DDGS exports to China achieved a month over month increase in April. A total of 125,587 MT were shipped to China, up 3 percent with highly competitive average pricing at $194.20/MT FOB.
The nearby market for DDGS in the Gulf has been very tight as barges favor the speed and ease of loading soybeans. Containers rates to Southeast Asia are up an average of $5 for July and August from last week, while rates to China and Japan showed larger increases.
Ethanol Comments: Daily U.S. ethanol production rose an average 8,000 barrels and hit a more seasonal level of 1.013 million barrels. Meanwhile, stock levels rose one million barrels (4.7 percent) to 21.2 million barrels.
The margin between the corn price and the value of ethanol and coproducts was variable this past week in the four key markets tracked (see below).
- Illinois differential is $1.82 per bushel, in comparison to $1.75 the prior week and $2.03 a year ago.
- Iowa differential is $1.90 per bushel, in comparison to $1.82 the prior week and $1.91 a year ago.
- Nebraska differential is $1.60 per bushel, in comparison to $1.64 the prior week and $1.64 a year ago.
- South Dakota differential is $2.08 per bushel, in comparison to $2.22 the prior week and $2.06 a year ago.