Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments: DDGS values are lower again this week amid sustained pressure from weaker soymeal and corn futures. Additionally, flooding in the upper Mississippi River continues to constrain river traffic and push additional product into the domestic market. As of 3 May, the U.S. Army Corps of Engineers said that nine lock and dams along Iowa and Illinois portions of the Mississippi river remained closed. Ethanol output ticked 1 percent higher last week but remained under 1 million barrels per day amid the ongoing seasonal spring maintenance period.
The FOB ethanol plant DDGS/cash corn price ratio rose to 1.13 this week, up from 1.12 last week and above the three-year average of 1.06. The DDGS/Kansas City soymeal ratio was slightly lower this week at 0.56, down from 0.57 last week and still above the five-year average of 0.50.
Barge rates continue to work their way lower amid the river navigation issues and barge CIF NOLA DDGS prices are down $30/MT for spot shipment and down $28/MT for June/July. FOB Gulf offers are similarly lower at $289/MT, a $25 decline from last week. Offers for 40-foot containers to southeast Asia are down $15/MT compared to last week at $373 for May/June shipment.
