April 17, 2007

Distillers grain may solve corn supply problem

Distillers grain -- the by-product left behind from the ethanol-making process -- could be the livestock industry's solution from the soaring prices of corn.

The demand for ethanol has corn prices reach record highs and caused livestock farmers to worry on lesser animal feed. Some economists say the booming ethanol sector could affect the nation's meat supply, with smaller livestock yielding less but higher prices of beef, pork and poultry.

Recently, researchers have intensified their work on dried distillers' grain with solubles (DDGS), the by-product left after the distillation process removes starch from the corn.

Increasingly used as livestock feed, the mixture is rich in protein, fat, vitamins and minerals. But its high oil content makes it difficult for some animal breeds to digest well amid strengthened research to make the grain more absorbable. Beef and dairy cows are most commonly fed DDGS at inclusions levels of up to 40 percent of their total rations while swine and poultry can only use DDGS at lower inclusions rates at 30 percent and 15 percent, respectively.

Although DDGS prices are typically directly related to corn prices, it costs US$125 per tonne, 20 percent below corn and up to 50 percent below soy.