Distiller’s Dried Grains with Solubles (DDGS)
DDGS Comments: DDGS values are mixed but mostly steady this week with support coming from the rally in soymeal futures and pressure from higher ethanol run rates that are expanding spot DDGS supplies. Ethanol production continues to trend above year-ago and five-year average levels amid strong production margins, which is keeping near-term DDGS supplies ample.
The DDGS/cash corn ratio of 1.19 is below last week’s value but still above the three-year average of 1.02. The DDGS/soymeal ratio fell from the prior week and hit 0.44, which is below the three-year average of 0.51.
Rates for DDGS delivered by rail to key U.S. locations are up $4-6/MT this week and reversed most of last week’s declines. Barge CIF NOLA DDGS offers are $2/MT higher this week as barge rates firm from their recent selloff amid challenging conditions on the Mississippi River. Spot offers for Barge CIF NOLA DDGS averaged $241/MT this week and the carries to December and January positions have widened from last week to $2 and $3, respectively. FOB Gulf offers are down $4/MT for November at $249 while offers for December and January are down $3. Finally, offers for 40-foot containers to Southeast Asia are unchanged this week at $294/MT for November as there has been little movement in ocean freight markets.
