Food & Beverage

Chicken wing prices fly on tight supply as major pizza player prices push higher

That pizzeria income adjunct of chicken wings are in tight supply, raising prices on the commodity, just as most major pizza brand players are also experiencing higher stock prices.

Get 'em while they're hot! Pizza and chicken wings are both hot commodities in the restaurant world these days. (iStock)

May 10, 2021

As prices for that pizzeria standby staple, chicken wings, take flight on the heels of tight supplies, and gas and wheat prices also trend higher, major publicly traded pizza brands got some encouraging news from investors who helped drive most brands monitored here weekly higher in value last week. Domino's, Papa John's and Pizza Hut parent, Yum brands, all added integers to their stock prices in the run-up to Mother's Day this past Sunday.

At the Ann Arbor, Michigan-based granddaddy of the publicly traded pizza brands, Domino's, investors added another $10.13 to the company's value to close Friday at $432.47. Meantime, Louisville, Kentucky-based competitor, Papa John's, which reported rosy quarterly results last week, investors raised the company's value another $2.63 to raise its weekly closing value to $99.35 Friday.

Pizza Hut parent and multiple QSR company Yum Brands also experienced some investor love last week, as trading activity helped raise that company's value to $121.23 Friday, up $1.71 for the week.

In fact, the one brand to lose value over last week's trading didn't suffer to badly, as Pizza Inn and Pie Five parent, Rave Restaurant group lost just 2 cents over the five trading days to close at $1.32 at week's end.

Cheese

In cheese trading on the Chicago Mercantile Exchange last week, barrels closed at $1.73, while 40-pound blocks ended at $1.75. The average for both trended lower on the week, with both barrels and blocks off about 2 cents each over the week to average $1.80 and $1.75, respectively.

The lower prices occurred after the U.S. Department of Agriculture reported that cheese market prices stumbled last Thursday, sending both block and barrel lower. Market undertones are less assured than they have been in previous weeks.

Cheese availability is mixed. Contacts in the Midwest and West have said barrels have become slightly more available, despite fairly healthy demand. Reports on block availability have shown growth in the past month, with Eastern cheesemakers report being in balance.

Wheat

In trading nationally on the wheat markets, prices edged higher. On the Chicago Board of Trade, preliminary volume estimates were lower at 102,128 CBOT contracts.

Across the board wheat prices edged upward as part of a five-week trend. In Chicago, soft red winter futures increased 31 cents to $7.73 per bushel. On the Minneapolis Grain Exchange, hard red spring wheat futures added 26 cents to close at $7.89 per bushel, while in Kansas City, hard red winter futures added 29 cents to close at $7.27 per bushel.

Chicken wings

For this staple of many pizza brands, the U.S.D.A. said that whole broiler/fryer prices are trending steady to firm, with the offerings of all sizes of broilers limited for current trade needs, including production issues reported at many plants. And although demand was moderate to active for this commodity in advance of Mother's Day, processing schedules have been normal to reduced.

Prices remain firm for wings, while the offerings are tight and difficult to acquire, with premiums being paid. In fact, some restaurants have been limiting their offerings of chicken wings or even running out of them, with most of the blame being attributed to earlier winter storms that cut yields.

Auto fuel

Another commodity experiencing increased demand is auto fuel, which has increased in price as we enter the spring driving season in the U.S., according to the American Automobile Association. Over last week, for instance, the national average for a gallon of regular gasoline increased four cents to $2.94. AAA said American drivers and the businesses that employ them should expect continued price fluctuations at the pump in the lead up to Memorial Day weekend.

The largest increases in average gas prices last week occurred in Michigan (up 16 cents per gallon), as well as Florida, Alaska and Kentucky (all up 9 cents), then Wisconsin, Utah and Delaware (up 8 cents).

Today, the average price of a gallon of regular was up 7 cents from a week earlier to is $2.97, and 10 cents higher than last month. At $3.30, mid-grade was also up 7 cents from the previous week, while at $3.57, premium was just 6 cents higher than the previous week.

Diesel averaged $3.12 or 3 cents higher on the week, while E85 was up 5 cents on the week to $2.51.

Natural gas

Natural gas spot price movements were mixed for the latest seven-day period reported by the U.S. Energy Information Administration, that ended May 5. This reflects highly variable temperatures across the country at the end of the report week, the administration said. The Henry Hub spot price rose from $2.93 per million British thermal units (MMBtu) to $2.97/MMBtu on May 5.

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 46 cents/MMBtu, averaging $7.66/MMBtu for the period. The price of natural gasoline, most closely correlated with crude oil, also rose 4% week over week. Elevated exports of propane, butane, and isobutane are supporting elevated prices of all three fuels, which rose by 9%, 6% and 7%, respectively. Ethane prices rose 3% week over week.