August 15, 2008

Don't forget DDGS when calculating corn supply

Hats off to the folks at the National Corn Growers Association who've done the math and reminded us to count distillers grains when talking about the total corn supply -- since distillers grains is a co-product of corn ethanol production and a good feed ingredient.

When USDA came out with its 12.3 billion bushel corn production estimate Tuesday, it also increased the amount of corn projected for ethanol use by 150 million bushels to 4.1 billion bushels, and the amount for livestock feed by 100 million bushels to 5.3 billion, making livestock and poultry feed the #1 consumer of corn.

But wait! Those projections don't include the amount of livestock feed that comes from the same corn that goes into ethanol. When you calculate that, you get an additional equivalent of 1 billion bushels of livestock feed derived from the corn for ethanol. This comes from the 25.3 million metric tons of distiller grains, 2.6 million tons of corn gluten feed and 500,000 tons of corn gluten meal.

"When you take into account the use of co-products, and shift a billion bushels of corn from the ethanol to the feed category, you get a better sense of where the corn is really going," said NCGA president Ron Litterer. "Actual ethanol production – as projected by the USDA for 2008 – will consume approximately 22 percent of the total 2008-09 corn supply of 13.9 billion bushels."

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