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Commodities: Pizza stock prices go down the drain with Thanksgiving scraps

Pizza restaurateurs got little in the way of gratitude from investors during the U.S. Thanksgiving week when it comes to their stock values.

November 26, 2018 by S.A. Whitehead — Food Editor, Net World Media Group

Investors showed little in the way of gratitude for the pizza brands monitored by this site during Thanksgiving week, with all four pizza chains recording lower overall stock values last Friday. Commodities trading offered pizza restaurateurs some relief in lower cheese and vehicle fuel prices, but for most pizza brand leaders last week was one they'd prefer to forget in hopes of happier hungry shopper days ahead.

Cheese

Cheese prices drifted lower over last week, according to the U.S.D.A. Agricultural Marketing Service, which reports that barrels closed at $1.2400, while 40-blocks were $1.35. The weekly average for barrels was down nearly 9 cents to $1.26, while blocks dropped nearly 4 cents in price to $1.37.

Food service orders for pizza-style cheeses are keeping mozzarella and provolone producers busy. But in the Northeast and Midwest, cheese producers are in some cases actually taking more days off for Thanksgiving than in previous years. That, in turn, has led to more discounted milk going to cheese producers who are running normal or heavier production schedules. 

The marketing service said its contacts report that the bullish current cheese prices come as inventories begin to clear, and milk availability trends downward, relative to past years. As a result, the service said prices could be heading upward in the new year, though some believe that may not happen until the latter half of 2019. 

Wheat

Compared to the previous week, cash bids for wheat were mixed, with wheat ranging from 27 3/4 cents lower to 2 1/4 cents higher, according to the U.S.D.A. Missouri Department of Agricultural Market News. Kansas City U.S. No. 1 Hard Red Winter, ordinary protein rail bid, was 7 to 16 cents lower, from $5.88-$5.94 per bushel. Kansas City U.S. No. 2 Soft Red winter rail bid was not quoted.  

St. Louis truck U.S. No. 2 Soft Red Winter terminal bid was 7 cents lower, from $5.22-$5.23 per bushel. Minneapolis and Duluth U.S. No. 1 Dark Northern Spring, 14.0 to 14.5 percent protein rail, was 27 3/4 cents lower to 2 1/4 cents higher, from $6.87-$7.17 per bushel. Portland U.S. Soft White wheat rail was steady to 5 cents lower, from $6.15-$6.35 per bushel.

Vehicle fuel

Gas prices continue to fall, with all grades and varieties down from this time last week. Regular unleaded this morning was coming in at an average of $2.56, down 7 cents from last week and a healthy 28 cents from last month, but still above the $2.51 we paid last year at this time.  

Mid-grade ($2.89) and premium ($3.15) followed that same downward trend, as did E85 ($2.22), with all about 6 cents lower than last week. Diesel, however, saw a far less significant drop in price, coming in at $3.20 today, down just 3 cents from last week. 

Natural gas

Natural gas spot prices rose at most locations for the seven days ending Nov. 14, the last week reported by the U.S. Energy Information Administration. Henry Hub spot prices rose from $3.51/MMBtu to $4.59/MMBtu over that period.

At the Nymex, the December 2018 contract price rose $1.28 from $3.555/MMBtu to $4.837/MMBtu Nov. 14. Net injections into working gas totaled 39 Bcf for the week ending Nov. 9. Working natural gas stocks are 3,247 Bcf, which is 14 percent lower than the year-ago level and 16 percent lower than the five-year (2013-17) average for the week.

The natural gas plant liquids composite price at Mont Belvieu, Texas, fell by 60 cents/MMBtu, averaging $6.95/MMBtu for the seven days that ended Nov. 14.  The price of natural gasoline, propane, butane and isobutane fell by 11, 11, 12 and 10 percent, respectively. The price of ethane rose by 3 percent.

According to Baker Hughes, for the week ending Tuesday, Nov. 6, the natural gas rig count increased by two to 195. The number of oil-directed rigs rose by 12 to 886. The total rig count increased by 14, and it now stands at 1,081.

Pizza company stocks

As previously mentioned, Thanksgiving week did not do much in the way of increased earnings and stockholder confidence for the four pizza brands monitored  by this site weekly. Instead, investors pulled back on the purse strings, taking the value of Domino's down $2.12 over the week to close Nov. 23 at $262.50. Pizza Hut parent, Yum Brands did not fare much better, falling in value over the week $1.62 to settle in at the close Friday at $87.19 on the New York Stock Exchange.   

Meanwhile, over on the Nasdaq, traders took back about $1.62 in value from Louisville-based Papa John's leaving that stock Friday at $57.29, while Papa Murphy's fell 27 cents over the week, to close Friday afternoon at $5.05. 

Photo: iStock

About S.A. Whitehead

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Pizza Marketplace and QSRweb editor Shelly Whitehead is a former newspaper and TV reporter with an affinity for telling stories about the people and innovative thinking behind great brands.