Ethanol Blog
Cheryl Anderson DTN Staff Reporter

Monday 09/17/12

DDG Prices Fall Again Last Week

With lower corn prices and more supplies, prices of dried distillers grains fell again last week for the third week in a row.

The DTN weekly spot price average fell $6 last week from the week prior, from $292 per ton to $286 per ton, marking the lowest price since mid-July. Prices of DDG have now fallen approximately $12 per ton, from the highest average of $299 per ton during the second week of August to last week's average of $286.

Of the 30 Midwestern locations DTN collects prices from, 26 locations reported that their prices had decreased between $2 and $12 per ton, but mostly between $5 and $10 per ton. No locations increased their prices last week from the week prior and prices at only two locations remained the same. Two locations had no offers last week.

Merchandisers told DTN last week that the lower prices were due to decreasing corn prices, as well as increasing supplies of DDG. Many ethanol plants had either shut down or scaled back production in recent weeks in order to protect their margins. However, those shutdowns, coupled with scheduled shutdowns for fall maintenance, resulted in tight DDG supplies and continuing high prices. As more ethanol plants have been up and running, DDG production has increased and has alleviated the shortness in supplies.

Also bringing down prices was a decrease in demand, as buyers have tended to buy week-to-week, waiting to get their DDG supplies purchased at as low a price as possible.

The value of DDG relative to corn last week rose slightly from the week prior, from 102.55% to 103.87%. The value of DDG relative to soybean meal fell slightly from 54.91% to 53.42% last week.

The cost per unit of protein for DDG was $11.44 last week, while the cost per unit of protein for soybean meal was $11.27.

Cheryl Anderson can be reached at Cheryl.anderson@telventdtn.com.

Posted at 2:09PM CDT 09/17/12 by Cheryl Anderson
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