Distillers Dried Grains with Solubles (DDGS)
DDGS Comments: Healthy U.S. ethanol will keep supplies of DDGS available to foreign buyers. The trade is reporting steady inquiries, and generally steady pricing. Vietnam remains a keen buyer and while container sales to Asia took an overall average 15 percent price slide for January shipments, the average for February and March deliveries is down only 1 percent. Containers to South Korea buck the trend noted above, with prices increasing into February and March. FOB Lethbridge, Alberta prices are holding steadily up from the past weeks through March.
There is speculation that DDGS sales to China could actually increase in the short-term.
Ethanol Comments: U.S. ethanol production was at one million barrels per day, up 7 percent from last week’s average. Ethanol imports averaged 32,000 barrels per day, and ethanol stocks climbed by 2.5 percent to 20.3 million barrels. Note that the U.S. Congress ended a 40-year ban on crude oil exports, which should strengthen oil prices and that of other fuels.
Ethanol remains a popular public policy with Civatal reportedly building a new sugar-based plant in Mato Grosso, Brazil. In India, where sugar-based ethanol production has doubled over the past year, the government is set to approve all ethanol automobiles while banning luxury diesel vehicles in downtown New Dehli in order to improve air quality.
For the week ending December 17, 2015 the differential between the price of corn and co-products for the four regions of the Corn Belt is as follows:
Illinois differential is $1.53 per bushel, in comparison to $1.67 the prior week and $3.33 a year ago.
Iowa differential is $1.34 per bushel, in comparison to $1.43 the prior week and $3.02 a year ago.
Nebraska differential is $1.56 per bushel, in comparison to $1.61 the prior week and $3.11 a year ago.
South Dakota differential is $1.48 per bushel, in comparison to $1.50 the prior week and $3.11 a year ago.
Country News
India: India needs to import corn for its starch makers and feed millers, who are suffering losses, but the government must issue a new tariff rate quota (TRQ), which it has not done since April and has resulted in a de facto import ban. Unclear is how it will manage reasonably priced imports with its zero tolerance for any GMO content.
Indonesia: Djarot Kusumayakti, CEO of Indonesia’s state procurement agency Bulog, says corn imports will total 600 KMT in the first quarter of 2016. Corn imports had been halted in July 2015 when the government tried to boost self-sufficiency. Bulog will handle all of the country’s planned 2.4 MMT of corn imports in 2016 through a new business model that is being developed. (Jakarta Globe)
Jordan: To solve its problems with procurement, Amman has contracted with UAE based Al Dahra Company to take over the country’s purchasing of 400 KMT of barley.