Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments: U.S. DDGS prices are up $14/MT this week as world grain and feedstuff markets remain supported by end users extending coverage amid increasing uncertainty. The Kansas City soymeal/DDGS ratio rose to 0.52 this week, up from 0.48 last week and above the three-year average of 0.47. The DDGS/cash corn ratio is lower at 0.97 this week, down from 1.02 last week and below the three-year average of 1.06.
Rising fuel and freight rates are influencing the delivered DDGS market this week. Merchandisers report that railroad fuel surcharges are pushing delivered offers higher while interior truck values are also strong and supporting prices. There is particular strength noted in the Western Corn Belt markets and one trader characterized the market for DDGS into Alberta as “spicy”. On average, rail-delivered DDGS are up $21/MT for April and up $24-26/MT for May/June delivery.
Barge CIF NOLA DDGS prices are up $21/MT for spot positions while FOB Gulf offers are equally higher, averaging $346/MT for April. Note that there is a wide range of indications in the market with offers reported late Thursday showing a significant premium to early week offers.
The market for containerized DDGS to Southeast Asia remains is still quiet with the uncertainty pushing traders to the sidelines. Offers are sharply higher this week, however, with the average Q2 price for 40-foot containers to Southeast Asia reaching $417/MT.
