DTN Weekly Distillers Grains Update
China Announces Plan to Monitor DDG Imports More Closely
Imports of certain U.S. grains and dried distillers grains with solubles to China will need to be registered beginning Sept. 1, according to a recent announcement by China's Ministry of Commerce.
All Chinese importers of DDG, sorghum, barley and cassava will need to register details of their purchases under the new system and apply for import permits for shipments.
Although there had been some indications that China was planning on taking steps to monitor imports more closely, the announcement last week was a bit of a surprise, according to Tom Sleight, president and chief executive officer of the U.S. Grains Council.
News reports following the announcements referred to the move as China's wish to monitor imports more closely. However, suspicions of China's trade decision remain after it's shutdown on DDGS imports over the MIR 162 biotech trait in 2014 wreaked havoc on the U.S. DDGS market, causing prices to plummet.
Industry experts theorize that China new regulations may have more to do with their glut of corn and their wish to monitor DDGS imports when they need to ensure end users purchase their own domestic corn first. In the past year, China has imported increasing amount of DDGS and sorghum especially, since even importing such grains/coproducts was less costly for livestock rations than the country's own domestic corn.
Sleight believes the two may be related, especially since the Council met with China's Ministry of Commerce officials.
"China does have a lot of corn stock. They also have some issues in terms of supply and demand for internal corn production" he said. "There are definitely some concerns there."
Although the registration of DDGS imports will begin on Sept. 1, Sleight said the process has been in place with soybeans for a while. This is a tracking process done through the China Chamber of Commerce of Import and Export of Foodstuffs, Native Produce and Animal By-Products (CNFA), an organization Sleight said the Council knows well and has worked with before.
The new requirements shouldn't be over-burdensome in terms of cost or red tape for Chinese DDGS customers, but will just take a little getting used to, Sleight said.
"It will be a little more difficult for buyers with the additional paperwork, but once they get used to it, I think everyone will settle into business as usual," he said. "It just may take a few weeks."
Sleight added that both importers and exporters can learn from the process that is in place currently for soybeans.
Overall, Sleight said the new regulations imposed on Chinese importers are not something that is as concerning as the approaching deadline.
"How quickly those permits get processed by the September 1st deadline is probably the biggest issue right now," he said.
Exporters of DDGS now need to engage, help with the process and work out the new import requirements aggressively.
"Fear could slow down some trade," he said. "But Chinese end users -- both sorghum and DDGS, like the product and want to keep buying it.
Although trade with China remains complex, Slight said that it is important for the Council to continue communication, adding that Council members met last week with CNFA.
"Our job is to be there and be in touch with both importers and exporters," he said. "We will all be sort of evolving as we go along."
Cheryl Anderson can be reached at cheryl.anderson@dtn.com.
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IN THE NEWS
California Drought Could Bring Down DDGS Demand
If drought continues to affect California farmers, demand for dried distillers grains with solubles from the Midwest could fall as a result, according to an article by Missouri Farmer Today (http://bit.ly/…).
The West Coast drought could likely decrease dairy production, as large dairies such as those in California require large amounts of water to operate. This could lead to several possible outcomes: increased demand for Midwest dairy products, expansion of Midwest dairies or relocation of dairies from California to areas with more water supplies, such as the Midwest.
California's demand for forages rose with the continued drought; however, demand for DDGS could fall. Since many California dairies buy DDGS from the Midwest, decreased dairy production could limit DDGS shipments to West Coast areas.
Cheryl Anderson can be reached at cheryl.anderson@dtn.com
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P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
DTN WEEKLY DDG SPOT PRICES
| CURRENT | PREVIOUS | ||||
| COMPANY | STATE | 8/21/2015 | 8/14/2015 | CHANGE | |
| Bartlett and Company, Kansas City, MO (816-753-6300) | |||||
| Missouri | Dry | $155 | $160 | -$5 | |
| Modified | $70 | $70 | $0 | ||
| CHS, Minneapolis, MN (800-769-1066) | |||||
| Illinois | Dry | $145 | $148 | -$3 | |
| Indiana | Dry | $150 | $150 | $0 | |
| Iowa | Dry | $148 | $145 | $3 | |
| Michigan | Dry | $155 | $150 | $5 | |
| Minnesota | Dry | $125 | $135 | -$10 | |
| North Dakota | Dry | $125 | $130 | -$5 | |
| New York | Dry | $155 | $155 | $0 | |
| South Dakota | Dry | $125 | $130 | -$5 | |
| MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253) | |||||
| Kansas | Dry | $145 | $150 | -$5 | |
| POET Nutrition, Sioux Falls, SD (888-327-8799) | |||||
| Indiana | Dry | $140 | $145 | -$5 | |
| Iowa | Dry | $140 | $145 | -$5 | |
| Michigan | Dry | $145 | $148 | -$3 | |
| Minnesota | Dry | $140 | $145 | -$5 | |
| Missouri | Dry | $150 | $160 | -$10 | |
| Ohio | Dry | $135 | $150 | -$15 | |
| South Dakota | Dry | $130 | $135 | -$5 | |
| United BioEnergy, Wichita, KS (316-616-3521) | |||||
| Kansas | Dry | $140 | $140 | $0 | |
| Wet | $55 | $55 | $0 | ||
| Illinois | Dry | $168 | $168 | $0 | |
| Nebraska | Dry | $140 | $140 | $0 | |
| Wet | $55 | $55 | $0 | ||
| U.S. Commodities, Minneapolis, MN (888-293-1640) | |||||
| Illinois | Dry | $155 | $160 | -$5 | |
| Indiana | Dry | $145 | $150 | -$5 | |
| Iowa | Dry | $130 | $140 | -$10 | |
| Michigan | Dry | $145 | $150 | -$5 | |
| Minnesota | Dry | $130 | $135 | -$5 | |
| Nebraska | Dry | $130 | $135 | -$5 | |
| New York | Dry | $155 | $160 | -$5 | |
| North Dakota | Dry | $125 | $135 | -$10 | |
| Ohio | Dry | $145 | $150 | -$5 | |
| South Dakota | Dry | $125 | $130 | -$5 | |
| Wisconsin | Dry | $140 | $145 | -$5 | |
| Valero Energy Corp., San Antonio, TX (402-727-5300) | |||||
| Indiana | Dry | $135 | $140 | -$5 | |
| Iowa | Dry | $135 | $140 | -$5 | |
| Minnesota | Dry | $135 | $140 | -$5 | |
| Nebraska | Dry | $130 | $135 | -$5 | |
| Ohio | Dry | $145 | $150 | -$5 | |
| South Dakota | Dry | $120 | $120 | $0 | |
| Western Milling, Goshen, California (559-302-1074) | |||||
| California | Dry | $195 | $195 | $0 | |
| *Prices listed per ton. | |||||
| Weekly Average | $139 | $144 | -$5 | ||
| The weekly average prices above reflect only those companies DTN | |||||
| collects spot prices from. States include: Missouri, Iowa, Nebraska, | |||||
| Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan, | |||||
| Wisconsin and Indiana. Prices for Pennsylvania, New York and | |||||
| California are not included in the averages. | |||||
*The spot prices gathered by DTN are only intended to reflect general market trends and may vary. Please contact individual plant or merchandiser for exact prices.
If you would be willing to take a weekly phone call and have your distiller grains spot prices listed in this feature, please contact Cheryl Anderson at (308) 224-1527 or (800) 369-7875, or e-mail cheryl.anderson@dtn.com.
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| VALUE OF DDG VS. CORN & SOYBEAN MEAL | ||||
| Settlement Price: | Quote Date | Bushel | Short Ton | |
| Corn | 8/20/2015 | $3.7100 | $132.50 | |
| Soybean Meal | 8/20/2015 | $330.90 | ||
| DDG Weekly Average Spot Price | $139.00 | |||
| DDG Value Relative to: | 8/21 | 8/14 | 8/7 | |
| Corn | 104.91% | 110.85% | 110.56% | |
| Soybean Meal | 42.01% | 41.85% | 41.70% | |
| Cost Per Unit of Protein: | ||||
| DDG | $5.56 | $5.76 | $5.84 | |
| Soybean Meal | $6.97 | $7.24 | $7.37 | |
| Notes: | ||||
| Corn and soybean prices taken from DTN Market Quotes. DDG | ||||
| price represents the average spot price from Midwest | ||||
| companies collected on Thursday afternoons. Soybean meal | ||||
| cost per unit of protein is cost per ton divided by 47.5. | ||||
| DDG cost per unit of protein is cost per ton divided by 25. | ||||
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USDA MARKET NEWS/DISTILLER GRAINS PRICES
USDA WEEKLY DISTILLERS GRAINS SUMMARY (Aug 14, 2015)
| Dried | Modified | Wet | |
| FOB PLANT PRICES PER TON | |||
| Iowa | 139.00-160.00 | 60.00-70.00 | 38.00-52.00 |
| Minnesota | 135.00-150.00 | 55.00 | 40.00-45.00 |
| Nebraska | 130.00-150.00 | 60.00-78.00 | 40.00-46.00 |
| South Dakota | 128.00-140.00 | 63.00-66.00 | 43.00-48.00 |
| Wisconsin | 145.00-160.00 | 65.00-80.00 | NQ |
| Eastern Corn Belt | 140.00-168.00 | 43.00-70.00 | NQ |
| Kansas | 140.00-169.00 | NQ | 45.00-60.00 |
| Northern Missouri | 150.00-160.00 | NQ | 42.00-47.00 |
| DELIVERED PRICES PER TON | |||
| CIF NOLA | 178.00-192.00 | ||
| Pacific Northwest | 185.00-193.00 | ||
| California | 189.00-193.00 | ||
| Texas Border (metric ton) | 210.00-225.00 | ||
| Lethbridge AB | 162.00 | ||
| Chicago | 159.00-175.00 | ||
Dried Distillers Grain: 10% Moisture
Modified Wet Distillers: 50-55% Moisture
Wet Distillers Grains: 65-70% Moisture
CALIFORNIA WHOLESALE FEEDSTUFF PRICES (Tue Aug 18, 2015)
Distillers Dry Grains
Rail to California Points 190.00-204.00 unch
FOB Truck to California Points 195.00-205.00 dn 5.00
PACIFIC NORTHWEST WEEKLY FEEDSTUFFS (Tue Aug 18, 2015)
Offers for Distillers Dried Grains delivered in September by rail to feed mills in the Pacific Northwest were 2.00 to 13.00 lower from 191.00-197.00. Offers for distillers dried grains trans-loaded onto trucks and delivered to Willamette Valley dairies were also 2.00 to 13.00 lower from 209.00-212.00.
*All prices quoted per ton unless otherwise noted.
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NASS/USDA MONTHLY CO-PRODUCTS PRODUCTION
Dry and Wet Mill, Co-products and Products Produced - United States
April 2015 - June 2015
Aug 3, 2015
Highlights:
Dry mill co-product production of distillers dried grains with solubles (DDGS) was 1.98 million tons during June 2015, up 4 percent from May 2015 and up 17 percent from April 2015. Distillers wet grains (DWG) 65 percent or more moisture was 1.14 million tons in June 2015, down 7 percent from May 2015 and down 5 percent from April 2015.
Wet mill corn gluten feed production was 324.9 thousand tons during June 2015, down 7 percent from May 2015 but up 4 percent from April 2015. Wet corn gluten feed 40 to 60 percent moisture was 306.4 thousand tons in June 2015, down 6 percent from May 2015 and down 2 percent from April 2015.
| Co-products and Products | Apr 2015 | May 2015 | Jun 2015 |
| Dry Mill | tons | ||
| Condensed distillers solubles (CDS-syrup) | 139,930 | 148,637 | 145,244 |
| Corn oil | 102,610 | 119,281 | 120,582 |
| Distillers dried grains (DDG) | 411,664 | 418,448 | 407,259 |
| Distillers dried grains with solubles (DDGS) | 1,690,903 | 1,892,983 | 1,976,508 |
| Modified distillers wet grains (DWG) <65% moisture | 1,200,282 | 1,228,598 | 1,136,491 |
| Modified distillers wet grains (DWG) 40-64% moisture | 389,889 | 417,888 | 367,092 |
| Wet Mill | |||
| Corn germ meal | 61,922 | 69,135 | 62,917 |
| Corn gluten feed | 313,889 | 350,141 | 324,905 |
| Corn gluten meal | 89,356 | 53,208 | 51,281 |
| Corn oil | 42,998 | 53,208 | 51,281 |
| Wet corn gluten feed 40-60% moisture | 314,047 | 325,292 | 306,354 |
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RFA WEEKLY U.S. LIVESTOCK FEED PRODUCTION
| CO-PRODUCT OUTPUTS (metric tons) | |||||
| Week Ending | Distillers Grains | Corn Gluten Feed | Corn Gluten Meal | Total Feed | Corn Oil (lbs.) |
| 7/24/15 | 95363 | 9859 | 1826 | 107047 | 5677126 |
| 7/31/15 | 94967 | 9818 | 1818 | 106603 | 5653594 |
| 8/07/15 | 95363 | 9859 | 1826 | 107047 | 5677126 |
| 8/14/15 | 95363 | 9859 | 1826 | 107047 | 5677126 |
*Information from 2010 Weekly U.S. Fuel Ethanol/Livestock Feed Production report (http://www.ethanolrfa.org/…)
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DDG LINKS/RESOURCES
Organizations
*Distillers Grains Technology Council
http://www.distillersgrains.org
*National Corn Growers Association Corn Distillers Grains Brochure
*Iowa Corn
Nebraska Corn Board
*Renewable Fuels Association - Ethanol Co-Products
*American Coalition for Ethanol
*U.S. Grains Council
*South Dakota Corn Utilization Council
http://www.drieddistillersgrains.com
Government Sites
*Iowa Department of Agriculture and Land Stewardship/Office of Renewable Fuels & Coproducts
http://www.distillersgrains.com
University Sites
*University of Minnesota - Distillers Grains By-Products in Livestock
and Poultry Feed
*University of Illinois - Illinois Livestock Integrated Focus Team Distillers Grains site
http://ilift.traill.uiuc.edu/…
*University of Nebraska - Beef Cattle Production By-Product Feeds site
*University of Nebraska Extension
*Iowa Beef Center - Iowa State University
http://www.iowabeefcenter.org/…
*University of Missouri - Byproducts Resource Page
*South Dakota State University - Dairy Science Department - Dairy cattle research
(select "Distillers Grains" from the topic menu)
*Purdue University Renewable Energy Web Site
http://www.extension.purdue.edu/…
(select "Biofuels Co-Products from the menu)
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DDG CONFERENCES
If you are sponsoring or know of any event, conference or workshop on distillers grains, and would like to list it in the DTN Weekly Distillers Grains Update, please contact Cheryl Anderson (see contact info below).
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We welcome any comments/suggestions for this feature. Please let us know what information is valuable to you that we could include in the Distillers Grains Weekly Update. Please feel free to contact Cheryl Anderson at (402) 364-2183, or e-mail cheryl.anderson@dtn.com.
(AG)
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