June 25—DDGS prices continued to oscillate, partly on demand as July 4 approached, but mostly followed corn futures. Export demand continues to move a large amount of tonnage—not just to Canada, Mexico and the Pacific Rim, but also to Turkey, Morocco and Chile. Export demand is key as the domestic market reaches saturation. Containers continue to move large tonnages overseas, and newly utilized bulk loading ports in places such as Superior, Wis., provide new opportunities.

The strength of the U.S. dollar still makes overseas trade a challenge, as do seasonally increasing domestic barge and international vessel freight rates. High water on the Mississippi is challenging the river loaders and barge lines. Although DDGS is still technically classified as a hazardous cargo, the U.S. Coast Guard is set to present a convincing case to the International Maritime Organization to reclassify it as a product that is safe to ship and handle.

Looking ahead, watch the price of U.S corn and soymeal in China. Both factors can swing DDGS prices dramatically. With China increasing bean imports, the new facet of demand must be watched. Although we have had plenty of moisture, the corn crop has many thinking the late summer distillers prices should be weaker, but the hint of China looming as a DDGS buyer helps to keep prices from dropping too far. Long term, the enthusiastic international acceptance of DDGS should keep opening new markets.