Ethanol Blog

DDG Prices Remain Steady Amid Some Slight Tightness in Supply

Cheryl Anderson
By  Cheryl Anderson , DTN Staff Reporter

Spot prices of dried distillers grains remained on a continued steady trend this week, with some tightness in supply reported in some areas.

The DTN weekly DDG spot price average increased only $1 per ton since last week, from $178 last week to $179 this week. The average continues on its long steady trend, hovering between $176 and $179 per ton since mid-January, but still the highest point the average has reached since June 2014.

Of the 36 Midwestern locations DTN collects spot prices from, 26 locations reported their spot prices remained unchanged since last week. Spot prices at seven locations increased between $5 and $10 per ton since last week, while only two locations had price decreases of $5 per ton each. One location said it had no offers this week.

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Merchandisers told DTN the past week has been a quiet one in trade, with some market tightness in some areas with buyers looking for product. With the Mississippi river open and barge traffic resuming with warm weather, some merchandisers expected prices to move higher as the calendar moves into April.

Most of the current demand for DDG is coming from export markets, which may be leading to the tight supplies in some areas. Inventory in the east seems to be a little lower, but will likely ease as more product begins moving down river.

Barge rates are up, but river prices are a little weaker, down about $5 per ton, especially in areas that have been experiencing heavier river traffic flow as spring weather has started.

The value of DDG relative to corn this week rose from about 130% last week to about 134% this week. The value of DDG relative to soybean meal also increased, from about 52% last week to about 56% this week.

The cost per unit of protein for DDG was about $7.16 this week, compared to the cost per unit of protein for soybean meal at $6.72.

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

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