Next Generation DDGs and the Potential for Corn and the Animal Ag Sector

September 15, 2020

Next Generation DDGs and the Potential for Corn and the Animal Ag Sector

Sep 15, 2020

Key Issues:EthanolAnimal Agriculture

Opportunities for new corn fractionation technologies at dry mills create value by further separating out the various components of corn to allow differential utilization of the subsequent product streams. Feed for animals is optimized by separating corn into its most valuable components.

 

Dried Distillers Grains with Solubles (DDGs) are a co-product of the ethanol production process and used 1.2 billion bushels of corn in 2019. DDGs are a feed ingredient for cattle, swine, poultry, and aquaculture, rich in protein, fat, minerals, yeast, and vitamins.

 

DDGs were never initially engineered, as they were an accidental discovery derived from the ethanol manufacturing process. As these next generation DDGs products become increasingly competitive in their nutritional composition, ethanol manufacturers have the opportunity to diversify their portfolio, plugging into newly created revenue sources. If an ethanol plant is experiencing a lull in liquid fuel demand, they could offset this loss or risk by continuing to produce specialized feed products for livestock, poultry and aquaculture producers as well as the pet food industry. This heightened level of confidence and corn demand consistency at a local ethanol plant could translate to additional dollars back on the farm. 

 

Cattle are a very important customer of DDGs, accounting for nearly 80 percent of consumption, with 50 percent attributed to beef cattle and 30 percent attributed to dairy cattle.

 

"Distillers Grains (DGs) are an incredible value-added feed source,” said Mitch Schweers, a corn and cattle producer from northeast Nebraska. “When deciding on the rate of DGs added to the ration we price against the value of corn and nutritional value. When looking at adding new products to our ration we rely heavily on our nutritionist to give us the best combination of feed source for the best conversion rate and lowest cost of gain."

 

Approximately 40 million metric tons of DDGs are produced annually. Pork producers recognize the product as an economically beneficial and nutritionally valuable source of protein and energy.

 

“We use DDGs at a 20 percent inclusion rate in our grower and finishing diets in our hog operation,” says Iowa pork and corn farmer Bob Hemesath. “We have gone up to 30 percent inclusion rates if the economics allow. DDGs are a great source of protein and our hogs grow extremely well on diets that include DDGs.”

 

To learn more about meeting the nutritional needs of swine with DDGs and next generation feed products click here. For more information on meeting the nutritional needs of cattle with DDGs and next generation feed products click here.