Market Perspectives – March 23, 2023

Distiller’s Dried Grains with Solubles (DDGS)

DDGS Comments: DDGS values are $5/MT lower this week amid pressure from falling soymeal values. Ethanol plants are entering the seasonal spring maintenance period, which will start to curtail supplies. Last week’s ethanol output fell 4 percent and dropped below 1.0 million barrels for the first time in nine weeks. The seasonal reduction in supplies is usually completed by early May, after which production rebounds to more typical levels.

The FOB ethanol plant DDGS/cash corn price ratio fell to 1.06 this week, down from 1.17 last week and above the three-year average of 1.06. The DDGS/Kansas City soymeal ratio also ticked higher and hit 0.53, up from 0.52 last week and above the three-year average of 0.50.

Barge CIF NOLA offers are steady for spot positions and $2/MT lower for May and June as strong barge freight offset the impacts of lower truck and rail offers. FOB NOLA offers are $7-10/MT lower for Q2 positions and average $339/MT for April. This week’s offers for 40-foot containers to Southeast Asia are $2-3/MT higher and average $397 for Q2 shipment.