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Market Matters Blog           08/06 10:48
US Infrastructure: Still in the Back of the Funding Line
DDG Prices Move Higher 
US Surface Transportation Board Still Waiting for Three New Members
2018 Spring Wheat Tour Preview: What Will Scouts Find?
DDG Prices Weaker
Positive Train Control: Are All US Railroads Ready for the 2018 Deadline?
DDG Prices Lower
Summer Storms Unkind to Farmers in Upper Midwest Region
Rain Filling Rivers
DDG Prices Continue to Move Lower

******************************************************************************
US Infrastructure: Still in the Back of the Funding Line

   On Aug. 1, 2007, at 6:05 pm CDT during rush hour in downtown Minneapolis, 
the I-35W bridge collapsed, sending cars, construction workers and trucks in to 
the Mississippi River below. A school bus carrying 63 children was also on the 
bridge, sitting precariously on a portion of the bridge that did not fall into 
the river. All the children were rescued but in the end, 13 people were killed 
and 145 were wounded. 

   It was a miracle that the death toll was as low as it was, given that within 
the hour before the collapse, traffic was heavier. This was partially due to 
baseball fans driving downtown for a Minnesota Twins game that evening. Also, 
at the time of the collapse, four of the eight lanes were closed for 
resurfacing, which had many cars finding different routes in and out of 
downtown.

   On Jan. 15, 2008, the National Transportation Safety Board (NTSB) announced 
it had determined a design flaw as the likely cause of the collapse, noting 
that a "too-thin gusset plate" ripped along a line of rivets, and additional 
weight on the bridge at the time contributed to the catastrophic failure.

   The I-35W bridge collapse sparked immediate calls within the state of  
Minnesota, as well as across the country, that the federal government must step 
up and invest funds in repairing and replacing the nation's aging and crumbling 
infrastructure, including bridges. 

   The collapse of the I-35W bridge was not due to deferred maintenance or 
neglect noted the NTSB. In fact, at the time of the collapse, construction had 
been taking place in the weeks prior, which included joint work and lighting 
replacement, and concrete and guardrails. 

   According to Wikipedia, there were 575,000 pounds of construction supplies 
and equipment on the bridge. The NTSB said that because of that design flaw, 
the additional weight on the bridge at the time contributed to the catastrophic 
failure.

   Since the collapse, at least 120 of the 172 bridges identified as 
structurally deficient or fracture critical in Minnesota have been repaired or 
replaced. According to National Public Radio (NPR), Minnesota also stepped up 
and improved bridge inspections, and now sometimes uses drones to take photos 
and video of spots on bridges that are difficult for human inspectors to reach. 
The state now gets outside independent peer reviews of bridge design plans and 
has revamped its bridge maintenance worker-training program.

   US ROADS AND BRIDGES NEED DEDICATED FUNDING

   The Ag industry relies on U.S. roads and bridges to haul commodities to 
market. Those roads and bridges must be maintained in order for farmers and 
shippers to have a safe path to ship their commodities. If the federal 
government does not come up with a plan to fix the aging roads and bridges, 
everyone would suffer consequences. The American Society of Civil Engineers 
(ASCE) report card gave U.S. roads a D on their 2017 infrastructure report 
card. 

   Here is a link to the report card, which also breaks out grades for each 
state in all infrastructure categories: 
https://www.infrastructurereportcard.org/ 

   At the National Grain and Feed Ag Transportation Summit in Washington, D.C., 
on July 25, two state Department of Transportation (DOT) directors spoke about 
the lack of funding for the U.S. roadways and said that there is a great need 
for dedicated and sustainable funding.

   The panel, consisting of Kirk Steudle, Michigan DOT and Tom Sorel, North 
Dakota DOT, discussed the fact that there is not enough money to maintain the 
interstate system. They suggested that each state raise their gas tax or 
registration fees or add tollways.

   The American Trucking Association (ATA) has said that it supports a fuel tax 
as a way to increase funding. On their website, the ATA notes, "Because it is a 
user fee, the fuel tax is the most conservative, cost-effective and viable 
solution to making that vision a reality. Ninety-nine cents of every dollar 
goes directly to road and bridge maintenance, and it doesn't add a penny to the 
deficit."

   Dr. David Ellis, Senior Research Scientist at the Texas A&M Transportation 
Institute with the Infrastructure Investment Analysis Program also spoke at the 
Summit. He said that as far as U.S infrastructure goes, there are more projects 
than there is money to fund them.

   "We had the best infrastructure in the world at one time," said Ellis. 
Population growth outweighed the ability of many states to keep up with new 
roads and bridges and repairs. "We need to be smarter and increase funding and 
change the way we get that funding," he added. He said that state and local 
governments would have to become responsible by adding fees and also by finding 
private sector investors. 

   "We must tell the story to the consumer in a way they understand the 
monetary cost versus the cost of doing nothing," added Ellis. "Do the 
maintenance or face the consequences."

   In their 2017 infrastructure report card, the ASCE said that at end of 2016, 
the U.S. had 614,387 bridges (four in 10) that are 50 years or older. The study 
noted that one in 11 (9.1%) of bridges were designated structurally deficient. 
The study graded the overall condition of the U.S. bridges a C+. As for cost of 
repairing and or replacing, ASCE reported in the study that the most recent 
estimate puts the nation's backlog of bridge rehabilitation needs at $123 
billion.

   Washington, D.C. based American Road & Transportation Builders Association 
(ARTBA) estimates it would take more than three decades to repair or replace 
the more than 55,000 bridges that are in most desperate need of it.

   Those of us in Minnesota who saw the aftermath of the collapse with our own 
eyes will never forget the catastrophe that took place the evening of Aug. 1, 
2007, forever changing the lives of the 145 survivors and the families of the 
13 people who died. 

   Sadly, it appears the federal government has forgotten, as U.S. 
infrastructure still waits in the back of the long line where federal funds are 
allocated.

   Mary Kennedy can be reached at mary.kennedy@dtn.com   

   Follow her on Twitter @MaryCKenn

******************************************************************************
DDG Prices Move Higher 

   OMAHA (DTN) -- The distillers dried grains (DDG) spot prices from the 40 
locations DTN contacted pushed higher in the past two weeks at $134 per ton for 
the week ended August. That's up $13 per ton versus the last update on July 19. 
Values have significantly improved with the strength in corn prices and a 
pickup in export interest for U.S. DDGS.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended Aug. 2 was at 102.30%, and the value of DDG relative 
to soybean meal was at 40.26%. The cost per unit of protein for DDG was $4.96, 
compared to the cost per unit of protein for soybean meal at $7.01. The DDG 
ratio to cash corn value remains pretty much in line with its two-year average 
and DDG remains the better value over soymeal. 

   In its weekly DDGS price update, the U.S. Grains Council (USGC) noted, "DDGS 
prices were up across the board this week, jumping to $224 per metric ton (mt) 
for FOB U.S. Gulf August shipment. Containers to Southeast Asia saw 
double-digit increases, with merchandisers reporting brisk market activity and 
sales to Vietnam and Thailand. According to USDA FAS, Vietnam's animal feed 
demand in 2018-19 will be up 3% to 30.9 million metric tons (mmt) due to 
expanding pork and aquaculture production. DDGS consumption will make the 
biggest jump in consumption, rising 45% to 1 mmt. Reportedly, ocean container 
capacity is filling up rapidly in response to the market's activity."


ALL PRICES SUBJECT TO CONFIRMATION             CURRENT        PREVIOUS   CHANGE
COMPANY   STATE                                8/2/2018       7/19/2018
Bartlett and Company, Kansas City, MO (816-753-6300)
          Missouri            Dry                $155           $135       $20
                              Modified           $75             $67       $8
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
          Missouri            Dry                $155           $140       $15
                              Wet                $80             $65       $15
CHS, Minneapolis, MN (800-769-1066)
          Illinois            Dry                $156           $147       $9
          Indiana             Dry                $148           $138       $10
          Iowa                Dry                $135           $120       $15
          Michigan            Dry                $144           $130       $14
          Minnesota           Dry                $120           $110       $10
          North Dakota        Dry                $120           $110       $10
          New York            Dry                $142           $130       $12
          South Dakota        Dry                $120           $110       $10
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
          Kansas              Dry                $135           $118       $17
POET Nutrition, Sioux Falls, SD (888-327-8799)
          Indiana             Dry                $145           $135       $10
          Iowa                Dry                $125           $110       $15
          Michigan            Dry                $140           $135       $5
          Minnesota           Dry                $125           $105       $20
          Missouri            Dry                $150           $140       $10
          Ohio                Dry                $145           $135       $10
          South Dakota        Dry                $115           $100       $15
United BioEnergy, Wichita, KS (316-616-3521)
          Kansas              Dry                $121           $118       $3
                              Wet                $35             $35       $0
          Illinois            Dry                $158           $150       $8
          Nebraska            Dry                $121           $118       $3
                              Wet                $35             $35       $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
          Illinois            Dry                $145           $135       $10
          Indiana             Dry                $140           $130       $10
          Iowa                Dry                $125           $115       $10
          Michigan            Dry                $140           $130       $10
          Minnesota           Dry                $125           $110       $15
          Nebraska            Dry                $125           $105       $20
          New York            Dry                $150           $135       $15
          North Dakota        Dry                $120           $110       $10
          Ohio                Dry                $145           $130       $15
          South Dakota        Dry                $120           $110       $10
          Wisconsin           Dry                $140           $130       $10
Valero Energy Corp, San Antonio Texas     (210-345-3362)     (210-345-3362)
          Indiana             Dry                $140           $133       $7
          Iowa                Dry                $117            $95       $22
          Minnesota           Dry                $115           $100       $15
          Nebraska            Dry                $120            $90       $30
          Ohio                Dry                $145           $140       $5
          South Dakota        Dry                $115           $105       $10
          California                             $205           $184       $21
Western Milling, Goshen, California (559-302-1074)
          California          Dry                $213           $199       $14
*Prices listed per ton.
          Weekly Average                         $134           $121       $13
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

   **


VALUE OF DDG VS. CORN & SOYBEAN MEAL
Settlement Price:                         Quote Date     Bushel    Short Ton
Corn                                      8/2/2018       $3.6675   $130.98
Soybean Meal                              8/2/2018       $332.80
DDG Weekly Average Spot Price             $134.00
DDG Value Relative to:                                   8/2       7/19
Corn                                                     102.30%   101.51%
Soybean Meal                                             40.26%    36.59%
Cost Per Unit of Protein:
DDG                                                      $4.96     $4.48
Soybean Meal                                             $7.01     $6.92
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

   Mary Kennedy can be reached at mary.kennedy@dtn.com 

   Follow her on Twitter @MaryCKenn

******************************************************************************
US Surface Transportation Board Still Waiting for Three New Members

   For the first time since its creation, Congress passed the Surface 
Transportation Board (also known as STB or Board) Reauthorization Act of 2015 
that became law on Dec. 18, 2015. Among other things, the new act expanded the 
STB from three members to five. 

   Here is a link to the Surface Transportation Board Reauthorization Act of 
2015: https://www.congress.gov/bill/114th-congress/senate-bill/808/text/pl 

   When President Trump was elected, he became responsible for nominating three 
new STB members, which would be subject to Senate confirmation. The political 
party in power can control the majority of the STB seats; meaning Republicans 
now have the opportunity to fill two of the three vacancies. Currently, the STB 
still consists of two members: Chairman Ann Begeman, a Republican, and Vice 
Chairman Deb Miller, a Democrat.

   In March of 2018, President Trump nominated two Republicans: Patrick Fuchs, 
a senior staff member of the Senate Commerce Committee and Michelle Schultz, 
associate general counsel for the Southeastern Pennsylvania Transportation 
Authority (SEPTA). On July 6, 2018, President Trump nominated Martin J. 
Oberman, a Democrat and attorney from Chicago. All are awaiting review and 
confirmation by the Senate. 

   Hon. Ann Begeman, STB Chairman, told participants on July 25 at the NGFA Ag 
Transportation Summit in Washington, D.C., that she is "hopeful" the three 
nominees are confirmed very soon. She said that rulemaking issues were on hold 
until the new members are confirmed, because they "need to be decided by all 
five members, not just two."

   Begeman is referring to these two issues: The rail rate case process and 
reciprocal switching. The rail rate case process has been under discussion 
since late 2013. Begeman noted what most shippers are painfully aware of this, 
and that is the current methodology used to challenge freight rail rates is 
unreasonable, time consuming and extremely costly for a shipper to file. 
Begeman said that, "rate reform is my top priority."

   The other issue, reciprocal switching, is perhaps the most contentious. 
Reciprocal switching refers to situations in which a Class I railroad that has 
physical access to a specific shipper's facility switches traffic from the 
facility to another railroad that does not have physical access, in exchange 
for compensation in the form of an access fee/switch charge. "This is a 
complicated issue," said Begeman. "We need to make sure we know what we're 
doing so there are no unintended consequences."

   Begeman added, "I want good rail service to where a shipper wants to go for 
the price they are willing to pay and don't have to worry about reciprocal 
switching costs."

   I asked Begeman if her hands were tied until the Board officially had five 
members, or were she and Miller able to rule on day-to-day issues, especially 
rail service issues.

   She said that other than the major rulemaking issues, the current Board is 
on top of service issues and shipper-related complaints. On March 16, 2018, the 
STB responded to industry concerns of poor rail service by sending a letter to 
all U.S. Class I railroads, requesting that they provide their service outlook 
plans in the near term and for the remainder of 2018, "due to increased 
concerns over deteriorating service." The STB asked for information about each 
railroad's network, including locomotive availability, employee resources, 
local service performance, service demand, communication strategies and 
capacity constraints. 

   Here is a link to the letters received by the STB from the railroads: 
https://www.stb.gov/stb/elibrary/NDP_Correspondence.html 

   Begeman said that shippers could contact her office at any time through the 
STB Rail Customer and Public Assistance Program. "This program solves problems 
in ways ranging from a simple answer to a telephone inquiry to lengthy informal 
mediation efforts," she said. Topics including questions on rates and other 
charges, railroad-car supply and service issues, claims for damage, interchange 
issues, employee complaints and community concerns. Begeman said that this 
program has been "successful for shippers." 

   Here is a link to more information, including phone numbers and other ways 
for shippers to submit a complaint: 
https://www.stb.gov/stb/rail/consumer_asst.html 

   "We can't fix everything," said Begeman, "but we sure will try."

   Mary Kennedy can be reached at mary.kennedy@dtn.com   

   Follow her on Twitter @MaryCKenn

******************************************************************************
2018 Spring Wheat Tour Preview: What Will Scouts Find?

   The 2018 Wheat Quality Council spring wheat and durum tour will begin and 
end in Fargo, North Dakota, with scouts gathering Monday, July 23, in the 
evening and then heading out to check fields July 24 through the morning of 
July 26. Similar to last year, day one will cover the southern half of North 
Dakota, southwestern Minnesota and northeast/north-central South Dakota. Day 
two will cover northwest and north-central North Dakota, with day three 
covering north-central/northeast North Dakota and northwest/west-central 
Minnesota. 

   "Expectations for this year are, of course, for better conditions in the 
west as opposed to last year where drought has not been an issue this year," 
said Dave Green, executive vice president of the Wheat Quality Council. 

   Green is referring to the severe drought that gripped the western part of 
North Dakota and north-central South Dakota last year where conditions were 
very poor. In fact, last year at this same time, the USDA weekly Crop Progress 
report showed spring wheat conditions in North Dakota as 40% very poor to poor, 
28% fair and 28% good. South Dakota conditions showed 74% of the crop in very 
poor to poor condition, 18% fair and 7% good.

   As of July 15, the most current USDA weekly Crop Progress report showed that 
4% of the North Dakota spring wheat is in very poor to poor condition, 13% is 
fair and 72% is good. South Dakota showed 13% of their spring in very poor to 
poor condition, 36% fair and 47% good.

   "South Dakota and North Dakota Wheat Commissions have been reporting that 
their crop is in good shape so far this year," said Green. He told me that, as 
of July 19, he had 55 scouts signed up to participate. "This year, I am sending 
a higher percentage of cars to the southwest due to higher acreage there."

   I had a chance to speak with farmers and elevator managers in North and 
South Dakota the past week and heard mixed expectations for their spring wheat 
crop.

   Keith Brandt, general manager of Plains, Grain and Agronomy in Enderlin, 
North Dakota said, "This spring wheat crop isn't the crop we had the last two 
years. The heat and dryness in May hurt wheat on lighter soils. And, we didn't 
get the tillering that we should. The stands are uneven and there is going to 
be issues with scab too. I don't buy the USDA yield estimate of 48 bushels per 
acre (bpa) statewide. That would match the record." Enderlin, North Dakota, is 
located in Cass and Ransom counties and is southwest of Fargo. 

   An elevator manager in east-central North Dakota said that wheat is average 
to just below average to the east, south and north of him. "The 
Hope/Finley/Clifford areas are a little drier and were planted two weeks late 
and are a little below average for sure. All the wheat started out very nice, 
hit a dry spell and went backwards," he said. "It had enough moisture to go on, 
but headed short and thinner than normal. It got good rains so it should have 
filled nice." 

   He told me that some areas are turning and are about two weeks out, but 
other areas still need a month. "I will tell you that some fields by my 
elevator look better from the road. One field I walked in had short and 
thinner-than-normal plants, with small heads and a lack of kernels. This was a 
field where the farmer put in all the necessary inputs and normally yields 
above average, but this year it will be average at best."  

   Jeff Kittell, merchandiser at Border Ag and Energy in Russell, North Dakota, 
said, "The spring wheat in our area looks good at the present time as we have 
been receiving rain all summer. Concern now is for scab and vomitoxin as 
humidity and lots of dew-filled mornings are perfect conditions for disease. 
However, I am seeing a lot of fungicide spraying with hopes that it will keep 
disease at bay." Russell is located in the north-central part of the state in 
Bottineau County.

   One year ago, Allan Klain, Turtle Lake, North Dakota, had this to say: "We 
are in the dark red on the drought monitor here. My hay ground is burnt up and 
my spring wheat is thin stands and headed out and barely a foot tall." 

   This summer, he has better news to share. "Our spring wheat looks good and 
we are expecting good yields. The early seeded fields lost some yield potential 
due to a very dry May. We had some emergence issues due to dryness at planting. 
It has evened out, but harvest could be drawn out. There has been a fair amount 
of spraying for fusarium (scab)." Turtle Lake is in McLean County and is in the 
south-central part of the state, north of Bismarck. 

   Tim Luken, manager of Oahe Grain in Onida, South Dakota, said, "Spring wheat 
plants are short this year, and I am very surprised at this. We had moisture to 
start things off in good shape. The wrath of Mother Nature, I guess! Spring 
wheat is turning fast, and I am expecting we see some spring wheat cut by the 
end of the week." Last year, Onida was in the throes of a never-ending drought, 
and while two hailstorms moved through his area this summer, he was uncertain 
as to exactly how many spring wheat acres were lost along with winter wheat and 
corn. Onida is located in Sully County in north-central South Dakota.

   "Things are looking pretty good around here considering how late the crop 
went in," said Ryan Wagner, Wagner Farms, located near Roslyn, South Dakota. 
"I'm worried we pushed it a little too hard in June with all the heat, but 
rainfall has been more than adequate. Starting to hear a few reports of scab 
showing up, but not sure if that is just localized or widespread. It's been 
quite a while since we have had a bad scab year, so maybe we are just 
overreacting." Roslyn is located in Day County in northeastern South Dakota. 

   "Overall, I'm starting to question whether or not this crop is as great as 
the USDA conditions indicate it is," said Wagner. "Acres are huge obviously, 
but between the scab issue and the warm June, I'm just not convinced it's going 
to be a bumper crop. Early winter wheat taken off around here this week was 
disappointing, but everyone says the spring wheat looks better."

   Wagner said that, on his farm, it's going to be a tough year for spring 
wheat because they got "slammed" with some pretty significant hail on July 9 on 
about half of his acres. "The crop insurance adjuster is coming to assess the 
damage, but we probably won't learn too much because the type of insurance we 
have requires all claims get deferred until after harvest." 

   It will be interesting to see what the scouts find this year, especially 
given the uncertainty in some areas mentioned above. 

   "Every car gives a detailed report each evening on their findings compared 
to previous year's results in each spot inspected," said Green. The 2017 spring 
wheat tour ended with an average yield of 38.1 bpa versus the USDA 2017 
September Small Grains Report final U.S spring wheat yield at 41.0 bpa.  

   When I was on the hard red winter wheat tour this past spring, Green told us 
that the tour is the industry's "first look" at the crop. "We know between now 
and harvest that yields can change, but the tour is a good starting point. It 
gives us the first snapshot of the 2018 crop." Scouts will be posting comments 
and pictures of scouted fields on Twitter using the hashtag #wheattour18. 

   And, as the saying goes, a picture is worth a thousand words.

   Here is link to information published by Ohio State University Extension on 
fusarium head blight, also referred to as scab: 
https://ohioline.osu.edu/factsheet/plpath-cer-06 

   Here is a link to information published by North Dakota Stata University on 
vomitoxin, also referred to as DON: 
https://www.ag.ndsu.edu/publications/crops/plant-disease-management-deoxynivalen
ol-don-in-small-grains-1 

   Mary Kennedy can be reached at mary.kennedy@dtn.com   

   Follow her on Twitter @MaryCKenn

******************************************************************************
DDG Prices Weaker

   OMAHA (DTN) -- The distillers dried grains (DDG) spot prices from the 40 
locations DTN contacted were mixed, but on average were lower this week at $121 
per ton for the week ended July 19, down $1 versus one week ago. Values have 
improved from recent weeks in some areas, thanks in part to a slight 
improvement in cash corn prices and a pick-up in export interest for U.S. DDGS.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended July 19 was at 96.46%, and the value of DDG relative 
to soybean meal was at 36.80%. The cost per unit of protein for DDG was $4.48, 
compared to the cost per unit of protein for soybean meal at $6.92. The DDG 
value to cash corn remains near the two-year average for this time frame. Even 
with soymeal values higher the past week and DDG prices lower, DDG is still a 
better value on a cost per unit of protein.

   In its weekly DDGS price update, the U.S. Grains Council (USGC) noted, "DDGS 
prices were mostly steady to down slightly this week. DDGS at the Gulf were 
unchanged from last week, while U.S. rail rates fell slightly. With prices 
stable, merchandisers are reporting buyer activity from Southeast Asian markets 
including Vietnam, Thailand, and the Philippines. Bangladeshi buyers are also 
reportedly active as container rates to that market fell to $267 per metric 
ton."

   Recently released U.S. Census Bureau data showed U.S. DDGS exports in May 
were up 38% from a year ago, with Turkey, Mexico, South Korea, Vietnam and 
Thailand the top destinations. Year-to-date reported export volumes are 
slightly up from the same period last year, noted USGC. 


ALL PRICES SUBJECT TO CONFIRMATION             CURRENT        PREVIOUS   CHANGE
COMPANY   STATE                               7/19/2018       7/12/2018
Bartlett and Company, Kansas City, MO (816-753-6300)
          Missouri            Dry                $135           $130       $5
                              Modified           $67             $65       $2
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
          Missouri            Dry                $140           $140       $0
                              Wet                $65             $65       $0
CHS, Minneapolis, MN (800-769-1066)
          Illinois            Dry                $147           $145       $2
          Indiana             Dry                $138           $138       $0
          Iowa                Dry                $120           $120       $0
          Michigan            Dry                $130           $130       $0
          Minnesota           Dry                $110           $110       $0
          North Dakota        Dry                $110           $110       $0
          New York            Dry                $130           $140      -$10
          South Dakota        Dry                $110           $110       $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
          Kansas              Dry                $118           $120       -$2
POET Nutrition, Sioux Falls, SD (888-327-8799)
          Indiana             Dry                $135           $140       -$5
          Iowa                Dry                $110           $105       $5
          Michigan            Dry                $135           $140       -$5
          Minnesota           Dry                $105           $105       $0
          Missouri            Dry                $140           $140       $0
          Ohio                Dry                $135           $140       -$5
          South Dakota        Dry                $100           $100       $0
United BioEnergy, Wichita, KS (316-616-3521)
          Kansas              Dry                $118           $118       $0
                              Wet                $35             $35       $0
          Illinois            Dry                $150           $150       $0
          Nebraska            Dry                $118           $118       $0
                              Wet                $35             $35       $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
          Illinois            Dry                $135           $135       $0
          Indiana             Dry                $130           $130       $0
          Iowa                Dry                $115           $115       $0
          Michigan            Dry                $130           $125       $5
          Minnesota           Dry                $110           $115       -$5
          Nebraska            Dry                $105           $110       -$5
          New York            Dry                $135           $135       $0
          North Dakota        Dry                $110           $110       $0
          Ohio                Dry                $130           $130       $0
          South Dakota        Dry                $110           $110       $0
          Wisconsin           Dry                $130           $130       $0
Valero Energy Corp, San Antonio Texas     (210-345-3362)     (210-345-3362)
          Indiana             Dry                $133           $133       $0
          Iowa                Dry                $95             $95       $0
          Minnesota           Dry                $100           $100       $0
          Nebraska            Dry                $90             $90       $0
          Ohio                Dry                $140           $140       $0
          South Dakota        Dry                $105           $105       $0
          California                             $184           $184       $0
Western Milling, Goshen, California (559-302-1074)
          California          Dry                $199           $205       -$6
*Prices listed per ton.
          Weekly Average                         $121           $122       -$1
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

   **


                     VALUE OF DDG VS. CORN & SOYBEAN MEAL
                        Settlement Price:   Quote Date      Bushel  Short Ton
                                     Corn      7/19/2018   $3.5125      $125.45
                             Soybean Meal      7/19/2018   $328.80
            DDG Weekly Average Spot Price        $121.00
                                  DDG Value Relative to:   7/19        6/28
                                                    Corn   101.51%      101.51%
                                            Soybean Meal    36.59%       36.59%
                               Cost Per Unit of Protein:
                                                     DDG     $4.48        $4.52
                                            Soybean Meal     $6.92        $7.02
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

   Mary Kennedy can be reached at mary.kennedy@dtn.com 

   Follow her on Twitter @MaryCKenn

******************************************************************************
Positive Train Control: Are All US Railroads Ready for the 2018 Deadline?

   In late 2015, Congress extended the deadline for positive train control 
implementation by at least three years to Dec. 31, 2018, with a possible 
extension to Dec. 31, 2020, if a railroad completed certain statutory 
requirements necessary to obtain an extension, according to the Federal 
Railroad Administration (FRA). The legislation, the Positive Train Control 
Enforcement and Implementation Act of 2015, required all railroads to submit a 
revised PTC Implementation Plan (PTCIP) by Jan. 27, 2016, outlining when and 
how the railroad would have a system fully installed and activated.

   The U.S. Department of Transportation (DOT) released a letter on Jan. 2, 
2018, from Secretary of Transportation Elaine L. Chao to all the nation's Class 
I railroads, intercity passenger railroads and state and local transit 
authorities, stressing the urgency and importance of safely implementing 
positive train control (PTC) systems in the upcoming year to meet the Dec. 31, 
2018, deadline, as mandated by Congress.

   "Advancing the implementation of PTC is among the most important rail safety 
initiatives on the Department's agenda," Secretary Chao said in the letter. 
"FRA leadership has been directed to work with your organization's leadership 
to help create an increased level of urgency to underscore the imperative of 
meeting existing expectations for rolling out this critical rail-safety 
technology." 

   U.S. Sen. John Thune, R-S.D., chairman of the Senate Committee on Commerce, 
Science and Transportation, convened a hearing titled, "Implementation of 
Positive Train Control" on March 1, 2018. "Railroad passengers expect railroads 
to follow safety laws and implement the necessary technology to do so, 
including PTC," said Thune. "After troubling reports that some commuter 
railroads are falling behind on implementation, this hearing will examine what 
needs to get done and what railroads need to do to meet their obligations." 

   Here is a link to the testimonies at the hearing: 
https://www.commerce.senate.gov/public/index.cfm/2018/3/implementation-of-positi
ve-train-control 

   BNSF Railway Company (BNSF) announced in December 2017 that it had fully 
installed PTC and was operating under PTC on all mandated subdivisions well 
ahead of the year-end deadline. However, in mid-June, they submitted a request 
to the DOT for a two-year extension of the PTC deadline, due to the FRA current 
interpretation of the law that full implementation status cannot be achieved 
until all non-BNSF trains and/or equipment operating on its PTC-equipped lines 
are also PTC compliant, according to a BNSF press release.

   "BNSF has succeeded in the adoption of this key safety technology. Even with 
this request for a deadline extension, BNSF's PTC network is installed and we 
are currently running, and will continue to run, more than a thousand trains 
daily with PTC as we continue to refine the system and resolve technological 
challenges," said Chris Matthews, BNSF assistant vice president, Network 
Control Systems.

   However, to be considered fully implemented requires that all other 
railroads operating across any of BNSF's PTC-equipped lines must be capable of 
operating with BNSF's PTC system, noted the press release. "This 
interoperability of PTC systems between Class I, commuter and short-line rail 
carriers remains a challenge," said BNSF. "While the BNSF has successfully 
demonstrated interoperability with several railroads that operate on its 
network, including commuter railroads and Amtrak, not all railroads that 
operate on BNSF will have completed their PTC installation by the end of 2018."

   Union Pacific (UP) has stated on their website that, at the end of 2018, PTC 
will be 100% installed on UP's required rail lines, and implemented on 75% of 
the required lines.

   "When we filed our revised implementation plan in 2016, the goal was full 
PTC implementation on all required lines by the end of 2018. However, as we 
implemented this complex suite of technologies across our network, the largest 
one in the U.S., unanticipated operational issues developed," UP stated on 
their website.

   "As permitted by Federal statute, UP intends to file with the FRA an 
alternative schedule for implementing PTC on the remaining segments as soon as 
practicable, but no later than the end of 2020. We will meet all criteria 
necessary for an alternative schedule, including full network installation and 
implementation on the majority of required lines, by the end of 2018.

   "UP remains committed to PTC. The alternative schedule provides flexibility 
to problem solve issues that arise, so that this critical safety system is 
implemented correctly. PTC will be installed and implemented for all passenger 
use on UP's required lines by the end of 2018."

   The Association of American Railroads (AAR) stated on their website that 
Class I railroads that meet the 2018 installation deadline can obtain an 
additional 24 months to test and ensure the system is fully interoperable. 

   "It is not enough to get PTC to operate across a single railroad's 
footprint; it must be interoperable. Interoperability means that the system 
works with any PTC-equipped locomotive running on any of the railroad tracks 
through the United States where PTC is required," noted AAR. "While some 
railroads will be fully implemented by the end of 2018, others will continue to 
test and will be fully interoperable no later than the 2020 deadline." 

   Here is a link to the background on Positive Train Control Enforcement and 
Implementation Act of 2015: 

   
https://www.transportation.gov/briefing-room/background-positive-train-control-e
nforcement-and-implementation-act-2015 

   Here is a link to an article posted by Association of American Railroads on 
Complexities and Challenges of PTC 

   https://www.aar.org/article/complexities-challenges-ptc/ 

   Here is a link to all U.S railroads quarterly reports on PTC implementation 
progress: 

   https://www.fra.dot.gov/Page/P0628 

   Mary Kennedy can be reached at mary.kennedy@dtn.com   

   Follow her on Twitter @MaryCKenn

******************************************************************************
DDG Prices Lower

   OMAHA (DTN) -- The average distillers dried grains (DDG) spot price from the 
40 locations DTN contacted was lower this week at an average of $122 per ton 
for the week ended July 12, down $4 versus two weeks ago.

   Merchandisers noted that DDG prices have come under pressure again from the 
move lower in soymeal values. Also, there is plenty of product to go around, 
and recent extreme hot temperatures added a little pressure as well to prices 
as animals don't eat as much when it is so hot. The cheaper corn price is the 
biggest culprit, because values have been shrinking thanks to the tension 
surrounding the trade war of the U.S versus China and other EU countries.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended July 12 was at 101.51%, and the value of DDG 
relative to soybean meal was at 36.59%. The cost per unit of protein for DDG 
was $4.52, compared to the cost per unit of protein for soybean meal at $7.02. 

   In its weekly DDGS price update, the U.S. Grains Council (USGC) noted, "DDGS 
prices for CIF NOLA (New Orleans, Louisiana), FOB Gulf, rail delivered PNW 
(Pacific Northwest), and rail delivered California steadied and showed slight 
increases this week. Internationally, container routes to Southeast Asia fell 
on average $5 per metric ton and merchandisers expect renewed buying interest 
soon." 


ALL PRICES SUBJECT TO CONFIRMATION              CURRENT       PREVIOUS   CHANGE
COMPANY     STATE                              7/12/2018      6/28/2018
Bartlett and Company, Kansas City, MO (816-753-6300)
            Missouri            Dry               $130          $145      -$15
                                Modified          $65            $75      -$10
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
Missouri    Dry                    $140           $140           $0
                                Wet               $65            $65       $0
CHS, Minneapolis, MN (800-769-1066)
            Illinois            Dry               $145          $148       -$3
            Indiana             Dry               $138          $135       $3
            Iowa                Dry               $120          $115       $5
            Michigan            Dry               $135          $145      -$10
            Minnesota           Dry               $110          $110       $0
            North Dakota        Dry               $110          $115       -$5
            New York            Dry               $140          $145       -$5
            South Dakota        Dry               $110          $115       -$5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
            Kansas              Dry               $120          $125       -$5
POET Nutrition, Sioux Falls, SD (888-327-8799)
            Indiana             Dry               $140          $145       -$5
            Iowa                Dry               $105          $115      -$10
            Michigan            Dry               $140          $145       -$5
            Minnesota           Dry               $105          $115      -$10
            Missouri            Dry               $140          $145       -$5
            Ohio                Dry               $140          $140       $0
            South Dakota        Dry               $100          $115      -$15
United BioEnergy, Wichita, KS (316-616-3521)
            Kansas              Dry               $118          $125       -$7
                                Wet               $35            $35       $0
            Illinois            Dry               $150          $150       $0
            Nebraska            Dry               $118          $125       -$7
                                Wet               $35            $35       $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
            Illinois            Dry               $135          $135       $0
            Indiana             Dry               $130          $130       $0
            Iowa                Dry               $115          $115       $0
            Michigan            Dry               $125          $125       $0
            Minnesota           Dry               $115          $115       $0
            Nebraska            Dry               $110          $110       $0
            New York            Dry               $135          $135       $0
            North Dakota        Dry               $110          $110       $0
            Ohio                Dry               $130          $130       $0
            South Dakota        Dry               $110          $110       $0
            Wisconsin           Dry               $130          $130       $0
Valero Energy Corp, San Antonio Texas       (210-345-3362)   (210-345-3362)
            Indiana             Dry               $133          $130       $3
            Iowa                Dry               $95           $105      -$10
            Minnesota           Dry               $100          $105       -$5
            Nebraska            Dry               $90           $105      -$15
            Ohio                Dry               $140          $140       $0
            South Dakota        Dry               $105          $110       -$5
            California                            $184          $186       -$2
Western Milling, Goshen, California (559-302-1074)
            California          Dry               $205          $210       -$5
*Prices listed per ton.
            Weekly Average                        $122          $126       -$4
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

   **


                     VALUE OF DDG VS. CORN & SOYBEAN MEAL
                        Settlement Price:   Quote Date      Bushel  Short Ton
                                     Corn      7/12/2018   $3.3650      $120.18
                             Soybean Meal      7/12/2018   $333.40
            DDG Weekly Average Spot Price        $122.00
                                  DDG Value Relative to:   6/28        6/28
                                                    Corn   101.51%      102.26%
                                            Soybean Meal    36.59%       38.02%
                               Cost Per Unit of Protein:
                                                     DDG     $4.52        $4.67
                                            Soybean Meal     $7.02        $6.98
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

   Mary Kennedy can be reached at mary.kennedy@dtn.com 

   Follow her on Twitter @MaryCKenn

******************************************************************************
Summer Storms Unkind to Farmers in Upper Midwest Region

   One year ago, on June 12, I had written about the severe drought in South 
and North Dakota that intensified as July rolled around. By that same time in 
June, much of the winter wheat in South Dakota had been either sprayed out 
after insurance zeroed it out or baled by livestock owners for feed. 

   "This year the crop was off to a great start" said Tim Luken, Manager of 
Oahe Grain in Onida, South Dakota. "With the exception of the first week of 
April blizzard, two weeks later, the temps were in the 80s, sending farmers out 
in the fields for the start of the 2018 planting season." 

   Luken noted that winter wheat came out of dormancy in "fine shape" and as 
spring wheat was planted in good time, acres were actually up from last year. 
"Producers no more than got done with spring wheat and went right into planting 
corn and behind the corn come soybeans and then sunflowers. Everything come up 
in excellent shape," said Luken. "Corn come up very uniform and very fast due 
to the warm soil temps. They say corn knee high by the Fourth of July; well let 
me tell you, how about shoulder high this year for the Fourth of July and I am 
6 foot 5 inches. I have never seen corn look so good for this part of central 
South Dakota."

   That all changed for Sully County when the great white combine paid a visit 
on June 27. That hailstorm brought heavy rain as it moved from northwest of 
Sully County and was five- to 10-miles wide as it moved southeast, taking 
everything out along an 80-mile swath. Then, on June 29, the white combine 
returned as if it wanted to finish the job. Hail hit between Onida and 
Gettysburg, and west of Agar to 20 to 30 miles east and was three to five miles 
wide. On July 1, the National Weather Service in Aberdeen said the June 29 
storm was a "supercell thunderstorm" that moved through portions of Wyoming and 
South Dakota and traveled over 420 miles.

   "Cornfields are stripped down to just ankle-high stalk, and wheat fields and 
grass ditches look like summer fallow," said Luken. "One farmer lost 15,000 
acres of 40,000 planted. I talked to one farmer who lost 20 quarters of his 
crop and I also know of some farmers that lost 100% of everything. If I had to 
put a guess to how much we have lost just in Sully County, I would say at least 
30% of the county was affected. Wheat in that county went from bales to hail, a 
second year of loss. Many thousands of acres equals many millions of bushels 
that will be lost for area farmers and grain elevators to handle this marketing 
year."

   Farmers in central Nebraska suffered more than one hailstorm this summer as 
well, with the storm on June 30 producing up to golf ball-size hail in a swath 
up to 3 1/2 miles wide from Arapahoe to south of Bertrand to east of Loomis. 
Andrew Philips, in Loomis, Nebraska, had hail on 750 acres. "Pending insurance 
adjustments, not sure what they will zero out, but from the looks of it, I 
think they will zero them. We had 320 acres of irrigated corn and 430 acres of 
irrigated soybeans. We did not lose our entire 2018 crop, but it took about 1/4 
of our acres that were looking really good and close to tasseling. We had 3.50 
inches of rain and pea- to golf-ball size hail along with 60 plus miles per 
hour winds in amount of 30 to 45 minutes."

   "On May 29 there was spotty hail, with one of my fields getting the ground 
covered," said Wayne Martin who farms in Pottawattamie and Shelby counties in 
southwest Iowa. "Some corn was severely damaged, and at another farm where I 
had beans got bad hail too. Three weeks later that corn looked fairly good, but 
I lost 25% stand in places. Beans were still quite uneven in size. Bean 
population is down to 70,000 in places. 

   "On top of that, we received 13 inches of rain in June, most of it last 
half. On June 28, we had a storm that produced 70 plus miles per hour winds, 
causing green snap in the corn. Some areas saw 70% to 97%; my hailed corn has 
up to 80% snap in some areas. More wind on the night of July 4 did some more 
damage on weak corn stalks. Now we are also seeing Japanese beetles exploding 
in beans, with some leaves totally defoliated. Beans are yellowing in low 
ground and high clay side hills from too much rain." 

   RAIN SOAKED FIELDS TRYING TO DRY OUT

   Adam Ramthun, Manson, Iowa, said they got 2 to 3 inches of rain on July 4 
and 1 to 2 inches June 30 and July 1. Other locations near him saw 4.5 inches 
since June 30 and 15 inches since June 11. "I was able to get out and get a 
majority of the soybean spraying done before the June 30 rain and also 
replanted to the low spots in a few fields," said Ramthun. "Those replants have 
all but been drown out again and lost. I have not been out looking for diseases 
in the corn or beans and have not heard of any big pressure in our area. Most 
of the first-planted corn is beginning to tassel in the area. A couple fields 
have lost a lot of nitrogen, and I am hoping to have a custom applicator add 
some when it dries off." 

   "In my almost 41 years of existence I have never seen water standing like 
this," wrote Jesse Fast in Delft, Minnesota, on a June 21 Twitter post. In his 
daily weather blog, Minneapolis-St. Paul meteorologist Paul Douglas noted on 
June 26, that according to the National Oceanic and Atmospheric Administration 
(NOAA), the Minnesota average June rainfall is roughly 4 inches. "Some sections 
of southwest and southcentral Minnesota and northwest Wisconsin have picked up 
three times the average amount of moisture in the last 30 days, with southern 
Minnesota receiving up to three months' worth of rain in that timeframe," said 
Douglas.

   On July 5, Fast told me that, "Fortunately we missed the rain over the 
weekend and only ended up with .3. It's still a mess with a lot of stuck 
sprayers and yellow corn. The first of some replants started today but most 
growers are saying it's too late for the beans and are just going to leave the 
drown outs. The water hasn't gone away in many holes from the rain three weeks 
ago yet."

   On July 5, Minnesota Governor Mark Dayton signed an Emergency Executive 
Order 18-11, proclaiming a State of Peacetime Emergency in numerous Minnesota 
communities that have been impacted by significant torrential rains, flash 
flooding, high winds and tornadoes. 

   Here is the link to the order and counties involved: 
https://mn.gov/governor/newsroom/#/detail/appId/1/id/345615 

   Justin Doerr, Plainview, Nebraska, said on July 5 that in his area, the rain 
was actually a blessing. "Sure, we have areas that are drowning out and other 
areas we couldn't plant, but the majority of the fields look great. Typically 
by now, irrigation systems are running hard, but ours hasn't moved all year. It 
has only been here lately that we've been catching hail/wind damage in the 
area. Except for some isolated spots, the hail has been light and crops are 
looking great. So far, pest pressure has been low, but disease is starting to 
show up in some areas. I would say weed control is our number one issue. With 
the frequency of rain, we've had only a few opportunities to be in the field. 
Many farmers in the area are dealing with excessive volunteer corn. This is due 
to the large wind event we had last fall that laid several fields over."

   Dave Newby of Bondurant, Iowa, told me on July 5 that after the 6.5 to 8 
inches of rain on his fields at the end of June, the main problem he saw in the 
corn is grey leaf spot. "We have decided to use fungicide by airplane, but it 
was a tough call with the plunging corn price. Not generally an overabundance 
of it now, but we want to stay ahead of it. We have stripped leaves from a hail 
event, so disease has a little easier time of getting started. We're going to 
try for 200 bushels per acre (bpa) yet with the fungicide, but we might just 
get 180 bpa if the N runs out.

   "We have had some northern corn leaf blight in past years, but I can't say 
there is a problem with that this year. Corn seems to have gotten established 
ahead of the rain a little better than the soybeans. I have concerns about 
losing too much nitrogen before the ear fills. Most of the corn looks dark 
green, but you can see yellowing and die back in the low spots starting to 
occur," Newby said.

   "The soybeans generally look good where they are not drowned or water 
stressed. Seeing a few Japanese beetles and there's a little more feeding than 
I'd like to see, but not enough to reach the economic threshold yet. We treat 
our beans with Ilevo on the seed, which helps with soybean cyst nematodes and 
sudden death syndrome. The beans are not growing very fast though. The soil is 
too saturated, and there is not enough oxygen present for optimal growth. About 
10% of our beans are drowned out or severely compromised. We were shooting for 
75 bpa. I would say 60 bpa would be a more realistic goal now."

   This comment from Newby likely rings true with farmers already stricken by 
severe weather events: "Hopefully, the worst is about over, but it could be a 
long summer."

   Let's hope the great white combine is out of commission for the rest of 2018 
and that the constant, extreme rain events are over. 

   Here is a link to the National Weather Service precipitation map for June 
across the Upper Midwest Regions:

   https://twitter.com/NWSTwinCities/status/1013544279325794310 

   Here is a link to the National Weather Service Aberdeen, SD showing a map of 
the second "hail scar" left behind on June 29 after one on June 27: 
https://twitter.com/NWSAberdeen/status/1013550313637154817 

   Here is a link to the National Weather Service Hastings, NE showing a map of 
June 30th hail damage north/west of Holdrege NE: 
https://twitter.com/NWSHastings/status/1015663608641056768 

   Mary Kennedy can be reached at mary.kennedy@dtn.com 

   Follow her on Twitter @MaryCKenn

******************************************************************************
Rain Filling Rivers

   While the Illinois and Mississippi rivers have been rising in recent weeks, 
the Minnesota Department of Natural Resources (DNR) has reported that 12 rivers 
in the state are at very high levels across southern Minnesota. Rain in that 
area has been relentless, flooding farm fields and rivers in Blue Earth, 
Cottonwood, Crow, LeSueur and other counties in that part of the state. 

   The National Weather Service in Chanhassen, Minnesota, noted that from 8 to 
14 inches of rain has fallen in much of southwestern and south-central 
Minnesota in the past two weeks. On Saturday and into Sunday, some of those 
same areas received scattered thunderstorms while heavy rains covered much of 
Iowa with 3 to 10 inches reported over the state. 

   Here is a link to the DNR river level site, which lists the current level of 
all the rivers in Minnesota: 
https://www.dnr.state.mn.us/river_levels/index.html 

   The Minnesota River is expected to rise to at least 30 feet by Thursday, 
July 5. Flood warnings likely will remain in effect on the Minnesota River at 
Savage through July 10. The river, a tributary of the Mississippi River, flows 
southeast from its source at Big Stone Lake on the South Dakota border to 
Mankato, Minnesota, then northeast to join the Mississippi River at Fort 
Snelling. As that river rises, it pushes water north and into the Mississippi 
River.

   On June 30, the Mississippi River from St. Paul to Winona was listed in the 
"very high" category, according to the DNR. The water level in St. Paul on July 
2 was at 13.5 feet and expected to move to 13.46 feet later in the day, unless 
more rain falls; minor flood stage is 14 feet. The Mississippi River at 
Burlington, Iowa, was at 17.7 feet on July 2; minor flood stage is 15 feet and 
major flood stage is 18 feet.

   Some elevators along the river have been scrambling to load barges, because 
when water levels get too high, barges can't fit under loading spouts. Another 
headache for loading elevators is that tows become restricted as to how many 
barges they can push when the water gets too high and is near or in flood stage.

   As of June 29, American Commercial Barge Line (ACBL) noted in their daily 
river updates that tows from St. Paul to Red Wing have been reduced from 12 
barges to six barges. From Red Wing to Prairie Du Chien, tows have been reduced 
from 12 barges to nine, and tows from Prairie Du Chien to St. Louis (UM 174) 
have been reduced from 15 barges to 12. ACBL said that an additional four to 
six days should be expected in pick-up time.

   In its weekly Grain Transportation Report, USDA noted that the return to 
high water will likely stall the recent surge in grain barge shipments. For the 
week ending June 21, grain barge tonnages on the locking portions of the 
Mississippi, Ohio, and Arkansas rivers were 1.1 million tons, continuing a 
three-week trend of tonnages exceeding 1 million tons per week. 

   "The recent surge has occurred as operating conditions have improved on most 
segments of the system, along with an increased demand for export corn. 
However, high water conditions are reoccurring on some parts of the Upper 
Mississippi and Illinois rivers, which might disrupt grain shipments," said 
USDA. Year-to-date tonnages have been about 8% lower than last year and 1% 
lower than the three-year average for the comparable time period. 

   At the Gulf, Tom Russell, Russell Marine Group said, "Water levels in the 
Baton Rouge/New Orleans Harbors are normal. Barge traffic and ocean vessel 
traffic are operating normally."

   As summer moves along, work on various locks and dams along the river system 
will slow traffic as well. At MM 811 on the Lower Mississippi River, ACBL has 
reported that contractors expect to be back to work on weir dike construction 
July 2 to July 3, and daily river closures will resume at this time. This 
closure will be for 12 hours each day, seven days a week and is expected to 
last 35 calendar days. This will be a full river closure during work hours; 
boats will only transit at night through this area.

   At Thebes, Illinois, near MM 38-46, rock removal has been ongoing but is 
always discontinued when water levels become too high. When levels drop and 
rock removal resumes, boat traffic is stopped during the daylight hours when 
work is in progress. Rock pinnacles need to be removed from the river bottom in 
an effort to keep the waterway at 9 feet deep in that stretch of the river to 
maintain a channel for barges to pass. 

   As the U.S. river system continues to age, repairs have become common, and 
at times, may stop barge traffic for days, depending on how much work needs to 
be done. Eventually, it is possible that some of the aging locks and dams may 
be beyond repair and will need to be replaced, which could stall traffic for 
weeks. 

   Mary Kennedy can be reached at mary.kennedy@dtn.com   

   Follow her on Twitter @MaryCKenn

******************************************************************************
DDG Prices Continue to Move Lower

   OMAHA (DTN) -- The average distillers dried grains (DDG) spot price from the 
40 locations DTN contacted was lower again this week at an average of $126 per 
ton for the week ended June 28, down $7 versus one week ago.

   Merchandisers noted the lower soymeal prices continue to pressure the DDG 
market, but even still, DDG has a per unit of protein cost advantage over 
soymeal. Also adding pressure to DDG prices is an increase in ethanol 
production, which is at its highest level since late December for the week 
ending June 22, according to the latest Energy Information Administration (EIA) 
report.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended June 28 was at 102.26%, and the value of DDG 
relative to soybean meal was at 38.02%. The cost per unit of protein for DDG 
was $4.67, compared to the cost per unit of protein for soybean meal at $6.98. 

   In its weekly DDGS price update, the U.S. Grains Council (USGC) noted, " A 
modest move higher in FOB U.S. Gulf corn values is helping stabilize FOB Gulf 
DDGS prices, with quotes for the latter mixed today but not far off last week's 
values. Internationally, merchandisers are reporting Asian buyers were waiting 
for clarity and a market floor early this week but have now "settled" with 
current prices. Prices for containerized shipments to Southeast Asia are steady 
with product destined for Bangladesh one of the few routes showing a decrease.


ALL PRICES SUBJECT TO CONFIRMATION       CURRENT     PREVIOUS CHANGE
                                                      6/21/
COMPANY   STATE                         6/28/2018      2018
Bartlett and Company, Kansas City, MO (816-753-6300)
          Missouri          Dry            $145        $150    -$5
                            Modified       $75         $75      $0
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
Missouri  Dry                 $140         $160        -$20
Wet              $65           $70         -$5
CHS, Minneapolis, MN (800-769-1066)
          Illinois          Dry            $148        $150    -$2
          Indiana           Dry            $135        $145    -$10
          Iowa              Dry            $115        $130    -$15
          Michigan          Dry            $145        $150    -$5
          Minnesota         Dry            $110        $125    -$15
          North Dakota      Dry            $115        $130    -$15
          New York          Dry            $145        $155    -$10
          South Dakota      Dry            $115        $130    -$15
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
          Kansas            Dry            $125        $130    -$5
POET Nutrition, Sioux Falls, SD (888-327-8799)
          Indiana           Dry            $145        $150    -$5
          Iowa              Dry            $115        $130    -$15
          Michigan          Dry            $145        $160    -$15
          Minnesota         Dry            $115        $130    -$15
          Missouri          Dry            $145        $150    -$5
          Ohio              Dry            $140        $150    -$10
          South Dakota      Dry            $115        $130    -$15
United BioEnergy, Wichita, KS (316-616-3521)
          Kansas            Dry            $125        $140    -$15
                            Wet            $35         $40     -$5
          Illinois          Dry            $150        $150     $0
          Nebraska          Dry            $125        $140    -$15
                            Wet            $35         $40     -$5
U.S. Commodities, Minneapolis, MN (888-293-1640)
          Illinois          Dry            $135        $135     $0
          Indiana           Dry            $130        $135    -$5
          Iowa              Dry            $115        $125    -$10
          Michigan          Dry            $125        $135    -$10
          Minnesota         Dry            $115        $125    -$10
          Nebraska          Dry            $110        $110     $0
          New York          Dry            $135        $135     $0
          North Dakota      Dry            $110        $115    -$5
          Ohio              Dry            $130        $140    -$10
          South Dakota      Dry            $110        $115    -$5
          Wisconsin         Dry            $130        $135    -$5
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
          Indiana           Dry            $130        $130     $0
          Iowa              Dry            $105        $112    -$7
          Minnesota         Dry            $105        $110    -$5
          Nebraska          Dry            $105        $100     $5
          Ohio              Dry            $140        $140     $0
          South Dakota      Dry            $110        $110     $0
          California                       $186        $181     $5
Western Milling, Goshen, California (559-302-1074)
          California        Dry            $210        $215    -$5
*Prices listed per ton.
          Weekly Average                   $126        $133    -$7
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

             VALUE OF DDG VS. CORN & SOYBEAN MEAL
               Settlement Price: Quote Date   Bushel Short Ton
                            Corn   6/28/2018 $3.4500   $123.21
                    Soybean Meal   6/28/2018 $331.40
   DDG Weekly Average Spot Price     $126.00
                      DDG Value Relative to:  6/28     6/21
                                        Corn 102.26%   104.31%
                                Soybean Meal  38.02%    40.08%
                   Cost Per Unit of Protein:
                                         DDG   $4.67     $4.93
                                Soybean Meal   $6.98     $6.99
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

   Mary Kennedy can be reached at mary.kennedy@dtn.com

   Follow her on Twitter @MaryCKenn

******************************************************************************

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