Hot Destinations for Dried Distillers Grains Exports: China, Mexico, Canada

[Fledermaus]

The landscape of U.S. distillers grains exports changed dramatically in 2010 and—depending on the outcome of the Chinese dumping accusation—could change radically in 2011, as well.
By Holly Jessen | February 15, 2011

In 2010, China sped past Turkey, Canada and Mexico, becoming the No. 1 destination for exported U.S. distillers grains, gobbling up 28 percent of the total DDGS exported worldwide. The odds that the upward trend would continue in 2011 came to a screeching halt in early January, however, with the announcement of China’s anti-dumping investigation.

In just four years, China’s importing of DDGS went from zero to millions of metric tons in 2010, according to information from the USDA Foreign Agricultural Service. It started out modestly with 1,150 metric tons (mt) in 2007 and grew to more than 542,000 mt in 2009. But that’s nothing compared to what happened in 2010. “They just skyrocketed,” says Mike Callahan, director of international operations for the U.S. Grains Council. “There are lots of numbers running around out there but I think the final tally, once it’s all in, China will have imported close to 3 million tons during 2010.” Others have estimated it could reach as high as 5 million metric tons (mmt).

Long-term Supplies

As ethanol production increases, so does the supply of DDGS which is expected to reach 33.3 million metric tons for the 2009-’10 marketing year, more than four times greater than in 2003-’04 and more than double since 2006-’07, according the USDA report on DDGS.

The rapid growth has prompted fears that DDGS will someday exceed feed-use potential. However, Linwood Hoffman and Allen Baker, authors of the USDA report, say that’s not likely. The potential for domestic and export use of U.S. DDGS currently exceeds production and will probably continue to do so in the future.

http://www.ethanolproducer.com/articles/7486/hot-destinations-for-ddgs-exports-china-mexico-canada