Ethanol Blog
Cheryl Anderson DTN Staff Reporter

Sunday 12/15/13

Logistical Woes Push DDG Prices Upward

A continuing shortage of trucks and railcars kept prices of dried distillers grains on an upward trend in the past week.

The DTN weekly DDG spot price average increased just $1 per ton in the past week, from $218 per ton the week before to $219 per ton this last week. This marks the fifth week in a row that the average has climbed steadily for a total of $14 per ton since the average was just $205 per ton in early November. This is the highest level the average has reached since mid-September.

Of the 30 Midwestern locations DTN collects prices from, 15 locations reported that their prices remained unchanged from the prior week. Prices at eight locations had increased between $3 and $30 per ton, but mostly about $5 per ton. Only six locations reported price decreases of $5 to $10 per ton, while one location reported no offers.

Merchandisers told DTN that logistics is the biggest issue right now. There are not enough railcars and trucks to go around and shipments are extremely slow. Ethanol plants are just trying to get everything shipped out before Christmas, but railcars and trucks are increasingly hard to find.

Also, tightness in supply is to blame for rising prices. Plants that have product available can offer it at higher prices and still get it sold.

The value of DDG relative to corn set another record high last week at more than 143%, while the value of DDG relative to soybean meal has decreased slightly in recent weeks, landing at almost 48% last week.

The cost per unit of protein for DDG was $8.76 last week, compared to the cost per unit of protein for soybean meal at $9.67.

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

(AG)

Posted at 4:37PM CST 12/15/13 by Cheryl Anderson
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