Ethanol oversupply situation may mean DDGS price increase

Ethanol Producer Magazine
By Holly Jessen March 02, 2012

With ethanol plants slowing production or even idling in response to tight margins and oversupply, a South Dakota State University economics adjunct professor is advising cattle feeders to consider changing their seasonal habits and lock in price or physical supply of distillers grains.

“Right now, I think the slowdown of ethanol plants is likely to make this a year when DDGS prices don’t follow that seasonal trend, but instead stay stable or increase,” Darrell Mark, a former Extension livestock marketing specialist at the University of Nebraska-Lincoln, told EPM. “Another factor is that demand for coproduct feed might increase a little due to winter weather—for cow/calf operations that use the feeds as a supplement, or to the extent that daily intake increases in feedlot cattle.”

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