Will the market for dried distillers grains keep rising with ethanol demand?

In Indiana, researchers at Purdue University are tracking the potential for the market for dried distillers grains (DDGs) to keep up with rising ethanol mandates. Supply of DDGs is expected to reach 40 million tons this year, and currently cattle have consumed 66 percent, hogs 7 percent and poultry 4 percent of the available supply.

The USDA National Ag Service found that 1276 livestock feeding organizations were using DDGs, and were using 28 – 61 percent of the maximum amount of DDGs is currently being fed to livestock.

The rise in corn ethanol production to 15 billion gallons under the Renewable Fuel Standard creates the potential for an oversupply of DDGs that may needed to be addressed through increased DDG exports. To date, Canada and Australia have the most advanced testing of DDGs among countries outside of the US.

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