Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments:
DDGS Comments: Prices for DDGS delivered to the Gulf were slightly lower this week, again reflecting improvements in the Mississippi River system. By contrast, rail delivery points inland saw increases as the potential for a labor strike is deemed to be growing. The deadline for ratifying new contracts is Monday. There is little change in container quotes to Asia, though softening cash corn prices could change this. On the flipside, last week’s drop in ethanol production could create some near-term tightness.
The value of DDGS relative to corn as of November 10 was 1.02 percent. DDGS carries a premium to corn and soybean meal for two reasons: 1) it accelerates weight gain and so more producers want it, but the supply available is a small fraction of corn and soymeal output. There are also seasonal factors such as livestock headed to the feedlot when fuel ethanol demand and consequently production slows for the winter.
