Farm Compliance

“The U.S. Grains Council (USGC) anticipates an increase of DDGS exports in 2009 with the resumption in growth of U.S. ethanol production,” said USGC Manager of International Operations for DDGS Dan Keefe. “There is no doubt, in the short term, the macroeconomic impacts of the recession have slowed the pace of U.S. exports, especially in DDGS, causing shortages in container freight, foreign credit restrictions for buyers, poor feeding margins and other factors. However, the Grains Council believes the economy will recover and ethanol production will continue to increase.”

Keefe said now that bulk ocean freight has stabilized, slightly higher values will be reflected in the container freight rates.

“Higher than normal soybean meal, oil prices and other unusual events have impacted trade flows and freight costs, adding relative value to the price of DDGS but limiting container freight to Asia. This makes it difficult to meet demand to certain container-freight-only destinations,” he said. “Normal trade flows are expected to stabilize as world economic pressure begins to alleviate, which in turn will influence the increase of container freight availability.”

The U.S. Grains Council conducts feeding trials and seminars around the world to expand the use of U.S. DDGS. In 2008, the United States exported 4.51 million tons of DDGS, almost double from the previous year's 2.36 million tons exported.

Grains Council presence in overseas markets continues to prove successful as the largest U.S. DDGS markets continue on an upward trend. In 2008, Turkey imported 465,000 tons, up 329,000 tons from the previous year; Canada imported 772,000 tons, up 453,000 tons from the previous year; and Mexico imported 1.189 million tons, up 481,000 tons from the previous year.

“The U.S. DDGS successes are a positive indication that DDGS remains a quality feed ingredient and is competitively priced in many of the major target markets,” Keefe said.