Illinois River DDGS basis holds firm despite seasonal ethanol run-down
Illinois River DDGS basis has traded a $12/mt premium to the Eastern Corn Belt reference through June, despite the seasonal slowdown in ethanol production. Structural export demand is doing the heavy lifting.
Production tape
Weekly ethanol production averaged 1.02 million barrels per day in June, down from the March peak but consistent with the five-year seasonal pattern. DDGS output has followed proportionally.
Export pull
Mexican and Central Asian buyers have been active at the Illinois River origin points, with June bookings up 14% versus the trailing three-month average. The basis has been well-supported as a result.
What we're watching
The August plant maintenance schedule and Q3 corn balance revisions are the next two data points that could move the basis materially. We expect a modest softening into September before a Q4 recovery.
DDGS remains a competitive protein and energy substitute for Central Asian rations at current parities. Firm offers on Jul/Aug/Sep shipment available on request.