DTN Weekly Distillers Grains Update
DDG Prices Spike Amid Firm Barge Values, High Corn and Soy Prices
Prices of dried distillers grains with solubles have risen steadily since mid-October, and have continued on that same trend in the past two weeks.
The DTN weekly spot price average jumped nearly $112 per ton in the past two weeks, rising from $112 per ton two weeks ago to $124 per ton this week. This is the highest level the average has reached since late July, and is the eighth-consecutive week that the average has increased, rising from a low of $98 in early October to this week's average of $124.
Merchandisers told DTN this week that factors contributing to the price include some renewed demand bringing spot prices up, exports possibly picking up, and prices of corn, soybeans and meals all up.
Chrissy Gothke, DDGS Merchant for The Andersons, Inc. in Maumee, Ohio, said firmer values (between $15 and $20 over the past two weeks), have also been fueled by firmness in the barge market and the movement of rail to the west coast.
"We've seen barge values firm in recent weeks and are seeing truck values trying to bridge the gap with rail, which is still trading at a premium," she said.
While all modes of transportation were problematic two weeks ago with an onslaught of snow, ice and freezing conditions, Gothke said she is seeing fewer issues with the rail lines at her facilities, as turn times have remained pretty good.
Truck availability has improved as most of the harvest is wrapping-up, especially in the last half of November.
"It was difficult for our customers to find trucks during harvest. It seemed freight carriers wanted to get as much grain hauled as possible," she said. "But now that harvest has wrapped up, we have seen an increased volume of truck traffic at all our plants."
Domestic demand has been increasing over the past three weeks, partly because of the seasonal trend when cattle are back on feed. Gothke said she has also seen an increase in interest for the local feeders to book for deferred months - from January forward.
Gothke said she has heard from some customers about the tight availability for DDGSs in the west as well as the supply availability for other various ingredients such as gluten.
Supplies of DDGS in the Midwest seem to be tight on the nearby, as well as in the January time frame, she said. But the overall supply at each plant largely depends on how aggressively sold on product the plant prefers to be.
Even though DDGS prices have been rising in recent weeks, Gothke said they are still a good value compared to prices a year ago.
"Customers easily forget how firm prices were last year at this time," she said. "They tend to remember what prices were a month ago, which were roughly $90-$100 a ton."
Export demand tends to ebb and flow, we have been seeing a slight increase in the movement to the Chicago container market, she said.
"We've seen the export market uptick a bit, not to the same tune as to the volume going to China," she said. "But we are seeing trucks move as containers are available. It depends right now on container availability.
In coming weeks, Gothke said she believes that values will stay steady to firmer.
"It doesn't seem like prices will soften any time soon," she said, adding that if anyone is looking to book their January to June needs, now might be a good time to consider that.
She also mentioned that she has heard of some plants seeing toxins in their DDGS from inbound corn.
"That may be something to keep an eye on," she said. "Buyers may want to ask their local plant if they are experiencing any toxin issues."
Cheryl Anderson can be reached at cheryl.anderson@dtn.com.
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IN THE NEWS
Ill. Ethanol Plant Produces Zein Protein
An Illinois ethanol plant will use new technology to extract a valuable corn protein from corn, according to an article by the Associated Press which appeared on THonline.com (http://bit.ly/…).
Big River Prairie Gold LLC has completed a lengthy permit process at its new zein extraction facility near the company's plant in Galva, Ill.
The project was a joint venture between ethanol producer Big River Resources LLC and Prairie Gold Inc., a company with patented technologies to produce high-value corn products.
The Galva site will use an extraction process that requires little energy, no chemicals and no fermentation to produce zein that will be used for food and pharmaceutical products. The company's patented products will be called "Amazein."
Zein appears as a fine, pale-yellow powder and can be used for such products as biodegradable plastics, paper coatings, food packaging, antioxidants, medical devices and pharmaceutical products, as well as food and cosmetics.
The zein is extracted before ethanol is produced, then the corn returns to the ethanol plant to make ethanol since the starch component in corn remains unaffected, according to the article. The process to get the zein product will lower the dried distillers grains by only about 300 tons of the plant's annual production of 342,000 tons.
Low-Oil DDGS Still New to Southeast Asian Buyers
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The U.S. Grains Council learned during its recent export Exchange conference that Southeast Asian buyers are still learning how to utilize the low-oil dried distillers grains with solubles that are now common in the U.S.
According to an article on the Council's website (http://bit.ly/…), some end-users in the region are limiting inclusion rates when using low-oil DDGS in an attempt to minimize the effects of the variability in nutrient composition from DDGS from different sources.
The Council has launched an intensive outreach in Southeast Asia to address questions by end-users, as well as familiarizing nutritionists with low-oil DDGS by communicating new equations that estimate the amount of energy livestock metabolize. These equations can be used to manage the variability in nutrient content and result in the most value possible.
Kevin Roepke, the Council's regional director for South and Southeast Asia, said in the article that unfamiliarity with a new product usually leads to end users backing away, especially when much of the technical information is available in a language foreign customers don't understand. It is important for the Council to keep new technologies and information available to international feed ingredient formulators, he said.
Southeast Asia is the third largest buyers of U.S. DDGS, just behind East Asia and North America, and has imported more than 1 million metric tons of U.S. DDGS so far in the 2014 marketing year through September.
Cheryl Anderson can be reached at cheryl.anderson@dtn.com.
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DTN WEEKLY DDG SPOT PRICES
| CURRENT | PREVIOUS | ||||
| COMPANY | STATE | 12/5/2014 | 11/21/2014 | CHANGE | |
| Bartlett and Company, Kansas City, MO (816-753-6300) | |||||
| Missouri | Dry | $130 | $128 | $2 | |
| Modified | $70 | $70 | $0 | ||
| CHS, Minneapolis, MN (800-769-1066) | |||||
| Illinois | Dry | $145 | $110 | $35 | |
| Indiana | Dry | $130 | $105 | $25 | |
| Iowa | Dry | $125 | $100 | $25 | |
| Michigan | Dry | $130 | $115 | $15 | |
| Minnesota | Dry | $115 | $95 | $20 | |
| North Dakota | Dry | $120 | $110 | $10 | |
| New York | Dry | $155 | $130 | $25 | |
| South Dakota | Dry | $112 | $105 | $7 | |
| Hawkeye Gold, IA (515-663-6413) | |||||
| Iowa | Dry | NA | $115 | ||
| Modified | NA | $45 | |||
| MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253) | |||||
| Kansas | Dry | $135 | $120 | $15 | |
| POET Nutrition, Sioux Falls, SD (888-327-8799) | |||||
| Indiana | Dry | $125 | $110 | $15 | |
| Iowa | Dry | $115 | $104 | $11 | |
| Michigan | Dry | $120 | $115 | $5 | |
| Minnesota | Dry | $105 | $100 | $5 | |
| Missouri | Dry | $130 | $126 | $4 | |
| Ohio | Dry | $130 | $116 | $14 | |
| South Dakota | Dry | $120 | $112 | $8 | |
| United BioEnergy, Wichita, KS (316-616-3521) | |||||
| Kansas | Dry | $130 | $120 | $10 | |
| Wet | $45 | $45 | $0 | ||
| Illinois | Dry | $135 | $130 | $5 | |
| Nebraska | Dry | $130 | $120 | $10 | |
| Wet | $45 | $45 | $0 | ||
| U.S. Commodities, Minneapolis, MN (888-293-1640) | |||||
| Illinois | Dry | $135 | $110 | $25 | |
| Indiana | Dry | $125 | $110 | $15 | |
| Iowa | Dry | $125 | $107 | $18 | |
| Michigan | Dry | $125 | $112 | $13 | |
| Minnesota | Dry | $115 | $97 | $18 | |
| Nebraska | Dry | $130 | $120 | $10 | |
| New York | Dry | $175 | $165 | $10 | |
| North Dakota | Dry | $130 | $120 | $10 | |
| Ohio | Dry | $125 | $115 | $10 | |
| South Dakota | Dry | $115 | $105 | $10 | |
| Wisconsin | Dry | $120 | $100 | $20 | |
| Valero Energy Corp., San Antonio, TX (402-727-5300) | |||||
| Indiana | Dry | $125 | $115 | $10 | |
| Iowa | Dry | $120 | $115 | $5 | |
| Minnesota | Dry | $115 | $110 | $5 | |
| Nebraska | Dry | $130 | $125 | $5 | |
| Ohio | Dry | $125 | $115 | $10 | |
| South Dakota | Dry | $115 | $110 | $5 | |
| Western Milling, Goshen, California (559-302-1074) | |||||
| California | Dry | $215 | $210 | $5 | |
| *Prices listed per ton. | |||||
| Weekly Average | $124 | $112 | $12 | ||
| 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 | 12/4/2014 | $3.7600 | $134.29 | |
| Soybean Meal | 12/4/2014 | $385.70 | ||
| DDG Weekly Average Spot Price | $124.00 | |||
| DDG Value Relative to: | 11/28 | 11/21 | 11/14 | |
| Corn | 92.34% | 84.02% | 80.47% | |
| Soybean Meal | 32.15% | 30.20% | 28.21% | |
| Cost Per Unit of Protein: | ||||
| DDG | $4.96 | $4.48 | $4.44 | |
| Soybean Meal | $8.12 | $7.81 | $8.28 | |
| 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 (Nov 28, 2014)
| Dried | Modified | Wet | |
| FOB PLANT PRICES PER TON | |||
| Iowa | 100.00-125.00 | 45.00-55.00 | 25.00-36.00 |
| Minnesota | 100.00-110.00 | 45.00 | 40.00 |
| Nebraska | 115.00-144.50 | 50.00-69.00 | 40.00-51.00 |
| South Dakota | 99.00-108.00 | 49.00-60.00 | 32.00-34.00 |
| Wisconsin | 100.00-110.00 | 45.00-50.00 | NQ |
| Eastern Corn Belt | 108.00-140.00 | 45.00-53.00 | NQ |
| Kansas | 120.00-150.00 | NQ | 40.00-55.00 |
| Northern Missouri | 125.00-135.00 | NQ | 38.00-45.00 |
| DELIVERED PRICES PER TON | |||
| CIF NOLA | 174.00-185.00 | ||
| Pacific Northwest | 198.00-210.00 | ||
| California | 202.00-212.00 | ||
| Texas Border (metric ton) | 220.00-240.00 | ||
| Lethbridge AB | 185.00 | ||
| Chicago | 135.00-145.00 | ||
Dried Distillers Grain: 10% Moisture
Modified Wet Distillers: 50-55% Moisture
Wet Distillers Grains: 65-70% Moisture
CALIFORNIA WHOLESALE FEEDSTUFF PRICES (Tue Nov 18, 2014) *Current prices not available
Distillers Dry Grains
Rail to California Points 197.00-207.00 up 12.00-unch
FOB Truck to California Points 205.00-218.00 up 10.00-8.00
PACIFIC NORTHWEST WEEKLY FEED (Tue Nov 18, 2014) *Current prices not available
Offers for Distillers Dried Grains delivered in September by rail to feed mills in the Pacific Northwest were steady to 8.00 higher from 203.00-208.00. Offers for distillers dried grains trans-loaded onto trucks and delivered during September to Willamette Valley dairies were also steady to 8.00 higher from 221.00-223.00.
*All prices quoted per ton unless otherwise noted.
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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.) |
| 11/07/14 | 93485 | 9664 | 1790 | 104939 | 5565349 |
| 11/14/14 | 95857 | 9910 | 1835 | 107602 | 5706542 |
| 11/21/14 | 97043 | 10032 | 1858 | 108933 | 5777138 |
| 11/28/14 | 95066 | 9828 | 1820 | 106714 | 5659477 |
*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
*Distillers Grains Technology Council Inc.'s 19th Annual Distillers Grains Symposium
The Distillers Grains Technology Council will hold its 19th Annual Distillers Grains Symposium on May 13-14, 2014 at the Sheraton Crown Center at Kansas City, Missouri. For information, contact the DGTC office at (515) 294-4019 or (800) 759-3448, or check the DGTC website (http://www.distillersgrains.org).
(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.
(GH/AG/CZ)
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