Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments: U.S. DDGS prices are up another $5/MT this week, marking their ninth consecutive weekly gain. Spot domestic demand remains strong while concerns about the South American soybean crop and potential soymeal supplies are offering secondary support to the DDGS market. Another blast of artic air will push into the central U.S. next week, which will boost livestock feed demand. The Kansas City soymeal/DDGS ratio up to 0.49 this week, above last week’s value and the three-year average of 0.47. The DDGS/cash corn ratio rose to 1.0 this week, above the prior week but below the three-year average of 1.06.
Better weather in the U.S. has eased some logistics issues and allowed barge freight to stabilize this week. Consequently, offers for Barge CIF NOLA DDGS are steady for spot shipments this week and down $1-2/MT for Q2 shipment. FOB NOLA offers are up $2/MT for March this week at $323/MT while Q2 and further deferred positions are steady. U.S. rail rates have pulled back sharply this week, by an average of $9/MT for spot positions.
The market for containerized DDGS to Southeast Asia remains quiet with both buyers and sellers remaining on the sidelines. Offers, however, are slightly higher at $371/MT for 40-foot containers to Southeast Asia, up $6/MT from last week.
