Distillers dried grains with solubles, a feed product almost unknown in the export trade a decade ago, is not only widely accepted in international markets today, but increasingly in demand. U.S. DDGS exports more than doubled from 2007 to 2008, increased roughly 25 percent in 2009 (despite the worldwide recession), and by 2010 were double the 2008 level. We see demand growing in several ways. More countries are importing DDGS, and on an individual country level, imports are higher. That&rsquo;s because more livestock feeders are adopting DDGS, and as they gain experience using it, they increase their inclusion levels. The top 10 export markets for U.S. DDGS, which imported almost 4.7 million metric tons (mmt) in 2009, are projected to nearly triple their purchases to more than 12.5 mmt by 2013.
The underlying dynamic behind DDGS demand is the same one fueling demand for corn and other grains: a growing world population that is also experiencing economic growth. Not only are there more people to feed, but more people who can afford (and want) to improve their diets with more animal-based proteins. For example, the USDA is forecasting a long-term economic growth rate of 7.9 percent in India and 8.3 percent in China. Worldwide economic growth is projected at 3.4 percent, compared to world population growth averaging 1 percent. In another projection, the World Bank sees the number of households with incomes of at least $16,000 per year increasing from 352 million in 2000 to 2.1 billion by 2030. The number of low-income consumers who escape from poverty is the most important factor that will determine the future global demand for food. These projections translate into pressure to produce a lot more meat, poultry, eggs and milk.
The U.S. Grains Council, which has made DDGS market development a top priority for nearly 10 years, sees plenty of real-world evidence to support the USDA and World Bank projections. In the past five months, council DDGS seminars in countries like Peru and Ecuador have sparked widespread interest among livestock producers, leading to Peru&rsquo;s first DDGS purchase since 2007. In southern Mexico, feed millers are looking for ways to incorporate DDGS as a regular component of feed rations. DDGS makes sense for them. In Egypt, DDGS is now in use in rations for poultry, dairy, beef cattle and aquaculture (a relatively new industry). In Turkey, officials are reportedly considering accepting key biotech corn events, a step that could open that important market to DDGS shipments by later this year. Most exciting of all is the potential in China, where significant DDGS purchases didn&rsquo;t kick in until September 2009. China&rsquo;s monthly imports grew steadily through the end of 2009, dropped back in early 2010, then climbed past 2009&rsquo;s highest monthly record in May 2010.&nbsp; Despite a countervailing duty announced by the Chinese government early this year, DDGS imports for January and February were higher than 2010 levels. In all, China bought more than 3 mmt of DDGS last year and has the potential to increase significantly considering their immediate needs and continued development.
While there are many positive signals for continued DDGS market growth, success won&rsquo;t come automatically. This is something the council and our industry partners must continue to work on. DDGS is still a new product for many livestock feeders. They have to be reassured about product quality and consistency. They need help with issues such as flowability and handling and with proper inclusion rates and use. There also are ongoing challenges created by government policies from tariffs to biotechnology restrictions and the need for better infrastructure to control transportation costs.
On sum, however, the outlook for ongoing growth in DDGS exports is good. In a world where many livestock feeders are uncertain about grain supplies and worried about price spikes, DDGS is a quality feed ingredient that gives them another option. As our international customers increase their experience with DDGS, the question we will get from them is, &lsquo;Will you have enough DDGS to meet our needs?&rsquo; Author: Alvaro Cordero Manager of International Operations for DDGS U.S. Grains Council (202) 789-0789 <a href="mailto:grains@grains.org">grains@grains.org</a>

World DDGS Customers Ask: “Can You Meet Our Needs?”

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Upcoming Events

North American SAF Conference & Expo

2026 International Biomass Conference & Expo

World DDGS Customers Ask: “Can You Meet Our Needs?”