By Mary Kennedy
DTN Cash Grains Analyst
OMAHA (DTN) -- The domestic distillers dried grains (DDG) average spot price from the 40 locations DTN contacted moved lower again this week versus the prior week, down $3 at $125 per ton for the week ended May 2.
In the past three weeks, the DTN average DDG price has dropped a total of $14 per ton. DDG prices are under pressure from lower soymeal and corn prices, along with an increase in ethanol plant production ahead of lower seasonal demand.
Based on the average of prices collected by DTN, the value of DDG relative to corn for the week ended May 2 was at 96.68% and is currently below the two-year average. The value of DDG relative to soybean meal was at 42.75%. The cost per unit of protein for DDG was $4.63, compared to the cost per unit of protein for soybean meal at $6.16.
In its weekly DDGS price report, the U.S. Grains Council noted: "DDGS indications saw another week of downward correction, with last-half May delivery becoming hard to realize, the nearby month moves to June and FOB vessel U.S. Gulf indications are at $191 per metric ton (mt) for that month. Further, U.S. rail rates saw a significant downward correction from last week to this week. Merchandisers report steady business from international buyers, including in Vietnam and Indonesia; 40-foot containers to Southeast Asian destinations are down $5/mt, on average."
USDA reported March production of distillers dried grains with solubles (DDGS) was 1.86 million tons during March 2019, up 10% from February 2019 but down 4% from March 2018. "Flood related complications during that timeframe likely pulled down that figure and the market is not anticipating year-over-year production to slip lower that far going forward," noted Informa Economics.
River conditions this week have worsened as floodwaters continue to rise and will hamper container movement to the Gulf. There are now 12 locks closed on the Mid Upper Mississippi River between Lock and Dam (L&D) 11 and L&D 22. Reopening dates are currently between May 2 and May 14, but that can change as the river continues to rise.
The Mississippi River at Davenport, Iowa, broke a previous record high of 22.63 feet set during the historic flooding of July 1993, after briefly rising to 22.7 feet on May 2. The St. Louis Harbor closed on May 3 due to the water rising above 38 feet, effectively stopping traffic from coming into and out of the Harbor. The river stage there is currently forecast to crest at 42.5 feet on May 6. The Mel Price Lock, which is 17 miles above St. Louis was expected to close late on May 2, along with Chain of Rocks Lock and Dam (L&D 27) which is near St. Louis.
| ALL PRICES SUBJECT TO CONFIRMATION | CURRENT | PREVIOUS | CHANGE |
| COMPANY | STATE | | 5/3/2019 | 4/25/2019 | |
| Bartlett and Company, Kansas City, MO (816-753-6300) | |
| Missouri | Dry | $130 | $137 | -$7 |
| | Wet | $70 | $72 | -$2 |
| | | | | |
| Show Me Ethanol LLC, Carrollton, MO (660-542-6493) |
| Missouri Subject | Dry | $135 | $130 | $5 |
| | Wet | $70 | $70 | $0 |
| | | | | |
| CHS, Minneapolis, MN (800-769-1066) |
| Illinois | Dry | $126 | $132 | -$6 |
| Indiana | Dry | $125 | $130 | -$5 |
| Iowa | Dry | $115 | $120 | -$5 |
| Michigan | Dry | $135 | $130 | $5 |
| Minnesota | Dry | $115 | $120 | -$5 |
| North Dakota | Dry | $120 | $120 | $0 |
| New York | Dry | $150 | $135 | $15 |
| South Dakota | Dry | $120 | $120 | $0 |
| MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253) |
| Kansas | Dry | $120 | $130 | -$10 |
| POET Nutrition, Sioux Falls, SD (888-327-8799) |
| Indiana | Dry | $130 | $135 | -$5 |
| Iowa | Dry | $120 | $125 | -$5 |
| Michigan | Dry | $125 | $125 | $0 |
| Minnesota | Dry | $125 | $130 | -$5 |
| Missouri | Dry | $140 | $145 | -$5 |
| Ohio | Dry | $135 | $140 | -$5 |
| South Dakota | Dry | $135 | $140 | -$5 |
| United BioEnergy, Wichita, KS (316-616-3521) |
| Kansas | Dry | $130 | $140 | -$10 |
| | Wet | $60 | $60 | $0 |
| Illinois | Dry | $140 | $148 | -$8 |
| Nebraska | Dry | $130 | $140 | -$10 |
| | Wet | $60 | $60 | $0 |
| U.S. Commodities, Minneapolis, MN (888-293-1640) |
| Illinois | Dry | $125 | $125 | $0 |
| Indiana | Dry | $120 | $120 | $0 |
| Iowa | Dry | $115 | $115 | $0 |
| Michigan | Dry | $120 | $120 | $0 |
| Minnesota | Dry | $120 | $120 | $0 |
| Nebraska | Dry | $115 | $115 | $0 |
| New York | Dry | $140 | $140 | $0 |
| North Dakota | Dry | $130 | $130 | $0 |
| Ohio | Dry | $133 | $133 | $0 |
| South Dakota | Dry | $125 | $125 | $0 |
| Wisconsin | Dry | $120 | $120 | $0 |
| | | | | |
| Valero Energy Corp, San Antonio Texas | (210-345-3362) | (210-345-3362) |
| Indiana | Dry | $125 | $120 | $5 |
| Iowa | Dry | $125 | $130 | -$5 |
| Minnesota | Dry | $115 | $123 | -$8 |
| Nebraska | Dry | $110 | $105 | $5 |
| Ohio | Dry | $135 | $135 | $0 |
| South Dakota | Dry | $130 | $135 | -$5 |
| California | Dry | $182 | $180 | $2 |
| Western Milling, Goshen, California (559-302-1074) |
| California | Dry | $195 | $208 | -$13 |
| *Prices listed per ton. |
| Weekly Average | | $125 | $128 | -$3 |
| 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. |
**
| VALUE OF DDG VS. CORN & SOYBEAN MEAL |
| Settlement Price: | Quote Date | Bushel | Short Ton |
| Corn | 5/2/2019 | $3.6200 | $129.29 |
| Soybean Meal | 5/2/2019 | $292.40 |
| DDG Weekly Average Spot Price | $125.00 |
| DDG Value Relative to: | 5/2 | 4/25 |
| Corn | 96.68% | 103.14% |
| Soybean Meal | 42.75% | 41.83% |
| Cost Per Unit of Protein: |
| DDG | $4.63 | $4.74 |
| Soybean Meal | $6.16 | $6.44 |
| Notes: |
| Corn and soybean prices take 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 27. |
Mary Kennedy can be reached at mary.kennedy@dtn.com
Follow her on Twitter @MaryCKenn
(AG)
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