Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments: DDGS values are weaker this week as the ethanol grind and DDGS output continues to run 10-15 percent above year-ago levels. Additionally, early-week weakness in the soymeal market and pressure in corn futures corn helped push values lower. Domestic demand for DDGS is starting to pick up with livestock feeders booking forward needs for the colder months when feed consumption rises.
The DDGS/cash corn ratio is lower than last week at 1.23 but is still above the three-year average of 1.02. The DDGS/soymeal ratio rose fell the prior week and hit 0.50, which is in line with the three-year average.
Rates for DDGS delivered by rail to key U.S. locations are down $6/MT this week and extended last week’s weakness with railroads lowering rates amid light demand. Barge CIF NOLA DDGS offers are $16/MT lower this week as barge rates pull back from their recent rally. Spot offers for Barge CIF NOLA DDGS average $239/MT with $1 carries for December and January positions. FOB Gulf offers are down $10/MT for November at $252 while offers for December and January are down $8. Finally, offers for 40-foot containers to Southeast Asia are down $6/MT due to the combined pullbacks in U.S. DDGS markets and ocean freight values.
