Ethanol Blog
Cheryl Anderson DTN Staff Reporter

Friday 08/09/13

Corn Board Pushes DDG Prices Down for Third Week in Row

Another drop in prices of dried distillers grains this week was due to a drop on the corn board. Prices of DDG tend to mirror movement in corn prices, and this week was no exception.

The DTN weekly DDG spot price average fell $3 per ton in the past week. This marks a $9 fall in the average in the past three weeks and the third consecutive week the average has fallen, from $235 in mid-July to this week's $226. This also is the lowest the average has been since early May.

Of the 29 Midwestern locations DTN collects prices from, 19 said their prices fell between $2 and $10 per ton since last week. Prices at 10 locations remained unchanged since last week and no price increases were reported.

Merchandisers told DTN this week that lower corn prices, as well as a slight dip in interest by buyers, worked to cause the third week of downward motion in DDG prices. Little change in prices is expected through the remainder of August; however, new crop corn and harvest may bring more price decreases in September and October.

Staff at plants still remain nervous about whether they will be able to buy enough corn to operation until harvest, which could result in regularly scheduled maintenance shut-downs to increase from the usual three or four days to as much as nine or 10 days.

The value of DDG relative to corn this week was at about 133.64%; however, that is a distorted number. The abrupt shift in the DDG to corn ratio after July 12 is due to the transition from July corn futures to the lower-priced September corn contract. The value of DDG relative to soybean meal this week was 53.49%.

The cost per unit of protein for DDG this week was $9.04, compared to the cost per unit of protein for soybean meal at $8.89.

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

Posted at 6:33PM CDT 08/09/13 by Cheryl Anderson
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