Ethanol Co-Product Helps Increase Ag Exports

Cindy Zimmerman

The U.S. agricultural exports picture continues to be a bright one thanks in part to more exports of the ethanol by-product dried distillers grains (DDGs).

In the latest USDA report on exports, the forecast for 2010 exports was increased to $107.5 billion, up $3 billion compared to the May estimate. Almost half of that gain was in the revised estimate for grain and feed exports – up $1.2 billion to $27.2 billion from the May forecast. Corn shipments are increased 1 million tons and $100 million, reflecting stronger shipments in recent months as demand for feed grains and feed products (especially DDGS) has been stronger than expected. “Agriculture is one of the few major sectors of the economy today that has a trade surplus, which we are now forecasting to be a little over $30 billion,” said Agriculture Secretary Tom Vilsack..

The forecast is even better for next year, up to $113 billion, very close to the record $115 in 2008, thanks to sharply higher unit values and volumes for wheat and corn, as well as increases in products like DDGs. “I think it’s an indication of the quality of what we’re producing, which I think has allowed us to aggressively market this product as sort of an offshoot of what’s taking place in the biofuels industry,” Vilsack said. “This is an untold and I think often under-appreciated aspect of our economy in terms of how productive American farmers are and how innovative we’ve become with what we grow and what we raise and how much more opportunity there is as we expand biofuel production, beginning to use other feedstocks. I think we’re just going to continue to see more and more of these kinds of opportunities, byproducts and co-products of the process being developed.”

Another reason for ethanol producers to attend the upcoming Export Exchange, sponsored by the US Grains Council and the Renewable Fuels Association, with the express purpose of getting buyers and sellers of DDGs in particular together. More than 170 international buyers of U.S. DDGS and coarse grains are scheduled to attend the event, including representatives from China, Japan, Taiwan, Korea and Vietnam – countries which have a major interest in DDGS. South Korea, Hong Kong, and Southeast Asia account for two thirds of the forecast increase in agricultural exports this year compared to May.

Distillers Grains, Ethanol, Ethanol News, RFA, USGC