Iowa DDGS Values to Trend Lower
Commodity prices have been moving higher in recent weeks. Both grain and oil values have been surging and many reaching multi-year highs in the process. DDGS Prices in Iowa averaged over $225 per ton in February, the highest they had been since 2014 following the 2012 drought. During that period, DDGS values increased to $300 per ton for a short period of time. Fortunately, the pandemic has not had quite the same impact and prices have started to move lower in March. Despite the average price decline seen in March, prices are more than $100 per ton over the prior three-year average.
Gasoline supply has been moving higher, which has led to increased ethanol output. The increase in ethanol production has led to higher amounts of DDGS being produced, which has taken some of the pressure of prices in the past few weeks. Expectations are that prices will continue lower through April. Historically, prices have only increased 40 percent of the time in April.