News Capsule: Likely 500,000-Tonne Cap on DDGS Imports Offers Temporary Relief to Distillers
10-Feb-2026 01:25 PM
News Capsule: Likely 500,000-Tonne Cap on DDGS Imports Offers Temporary Relief to Distillers
★ Under the interim India–US trade deal, DDGS imports from the United States may be capped at 500,000 tonnes in the first phase. This has provided near-term relief to the domestic distillery industry.
★ India currently produces around 2.5–3.0 million tonnes of DDGS from maize- and rice-based ethanol production.
★ A quota of 0.5 million tonnes would amount to roughly 10% of current domestic production.
★ However, if imports rise to 1.5–2.0 million tonnes, domestic margins could come under significant pressure.
★ The current landed price of DDGS is ₹23–25 per kg, which is close to prevailing domestic prices. US-origin DDGS is considered superior in quality due to lower aflatoxin levels, meaning it would compete with Indian supplies on both price and quality.
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Impact on Soymeal and Oilseed Markets
★ DDGS is a direct substitute for soymeal in poultry feed.
★ At present, DDGS is priced at ₹23–24 per kg, compared with soymeal at around ₹45 per kg.
★ Higher imports of DDGS could put downward pressure on soymeal prices, making it difficult for soybean farmers to receive prices above the Minimum Support Price (MSP).
★ In the past two kharif seasons, soybean mandi prices in Madhya Pradesh, Maharashtra, and Rajasthan have largely remained around or below MSP levels.
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Watch on Soybean Oil
★ In 2024–25, India imported a record 5.47 million tonnes of soybean oil.
★ Argentina supplied 2.89 million tonnes, followed by Brazil at 1.14 million tonnes.
★ The US share was only about 4%, or roughly 0.18 million tonnes.
★ If US soybean oil is allowed at zero duty (subject only to a 5% agriculture cess), it could exert pressure on crude soybean oil prices from Argentina and also impact palm oil prices.
★ However, US-origin soybean oil is typically $30–40 per tonne more expensive than supplies from Argentina or Brazil, which may limit the overall duty advantage.
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Conclusion
★ A 500,000-tonne DDGS quota is likely to have a limited and controlled impact in the near term.
★ A larger quota could hurt distilleries, oilseed processors, and farmers’ incomes.
★ For consumers, however, lower edible oil prices would be a positive outcome.