Knowing they have eliminated the competition, raw corn, from the feed market the distillers have been charging a pemium price for this allgeded waste product.
Higher feed prices have forced many beef operations to reduce herd sizes to the point this years herd is at 60 year lows.
The reduced herd size has reduced demand for distiller grain for feed to nearly half the of supply. Yet the prices of distillers grain do not reflect the glut.
There is also a problem with the added cost of starch supliments for dairy cows as distiller grain as a feed by itself has a negative impact on the quality of milk verses corn feed.
There is also emerging science indicating a higher incidence of E. Coli among healthy herds being fed distillers grain. This leads to increased beef processing costs.
A physical limitation of a rail car shortage is also disrupting the distillers market as trains are doing double duty bringing corn to ethanol distillers and the waste out to feed processors. The lack of transportation increases the spoilage rate of this waste product.
http://www.ethanolproducer.com/articles/4165/distillers-grains-symposium-to-address-feed-rations-animal-health/ 
