Commodities: Supply prices up, pizza stocks mixed

May 15, 2017 | by S.A. Whitehead

All the top pizza commodities rose in price last week, aside from vehicle fuel. On the stock market, pizza brands monitored at this website split with half taking a hit in value and the other half increasing value over the week.   

Cheese
After sleeping through winter and early spring, cheese prices have awoken and are soaring. They closed Friday at $1.64, up four cents from the prior week's close and a hearty 16 cents from two weeks ago, when the commodity's price was around $1.48. 

Wheat
Compared to the previous week, wheat was mostly 2 to 12 cents higher this past trading week. 
  
St. Louis truck U.S. No 2 Soft Red Winter terminal bid was 4 cents lower to 5 cents higher from $3.98 to $4.32 per bushel. Minneapolis and Duluth U.S. No. 
1 Dark Northern Spring, 14.0 to 14.5 percent protein rail, was 10 3/4 cents higher from $6.58 1/4 to $6.68 1/4 per bushel. 

Portland US Soft White wheat rail was 2 to 12 1/4 cents higher from $4.70 to $4.87 per bushel. Kansas City U.S. No. 1 Hard Red Winter, ordinary protein rail bid was 3 3/4 cents lower from $4.35 3/4 to $5.25 3/4 per bushel. 

Gasoline and diesel fuel
Gasoline prices  — somewhat uncharacteristically — are actually one of the brightest spots on today's commodities report, with prices finally showing some real substantial decreases over the past month, though still substantially higher than last year's prices.
This morning the average price of a gallon of regular was $2.34 nationally, which is about a penny lower than a week ago and 6 cents lower than last month. Still, a year ago at this time, the fuel went for just $2.22 a gallon, or a good 8 cents lower. 

Mid-grade and premium echoed that same pattern, with mid-grade now at about $2.62 a gallon and premium at $2.87 a gallon. The two fuels are still priced about 15 cents higher than last year at this time but have leveled off in price over the last month. 

Diesel is following suit, but not as far along in its price decline as the other grades. The price of that commodity this morning was $2.50 a gallon, which is a few cents less than last month but still 26 cents higher a gallon that the price we paid last year at this time. 

Natural gas
Natural gas spot prices rose at most locations this report week (Wednesday, May 3 to Wednesday, May 10). The Henry Hub spot price rose from $3.09 per million British thermal units (MMBtu) last Wednesday to $3.11/MMBtu yesterday. At the New York Mercantile Exchange, the June 2017 contract price rose 6 cents, from $3.228/MMBtu last Wednesday to $3.292/MMBtu yesterday.

Net injections to working gas totaled 45 Bcf for the week ending May 5. Working natural gas stocks are 2,301 Bcf, which is 14 percent lower than the year-ago level and 14 percent higher than the five-year (2012–16) average for this week. According to Baker Hughes, for the week ending Friday, May 5, the natural gas rig count increased by 2 to 173. The number of oil-directed rigs rose by 6 to 703. The total rig count increased by 7 and now stands at 877.

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 3 cents, averaging $5.99/MMBtu for the week ending May 10. The prices of natural gasoline, butane, and isobutane fell by 2, 1 and 3 percent, respectively. The prices of ethane and propane rose by 3 and 2 percent, respectively.

At the Nymex, the price of the June 2017 contract increased 6 cents, from $3.228/MMBtu last Wednesday to $3.292/MMBtu yesterday. The price of the 12-month strip, averaging June 2017 through May 2018 futures contracts, climbed 6 cents to $3.381/MMBtu.
According to data from PointLogic, the average total supply of natural gas rose by 1 percent compared with the previous week. Dry natural gas production remained constant week over week. Average net imports from Canada increased by 5 percent from last week.
Total U.S. consumption of natural gas fell by 1 percent compared with the previous report week, according to data from PointLogic. Week over week, power burn declined by 8, industrial sector consumption stayed constant at 20.5 Bcf/d, and residential/commercial sector demand increased by 11 percent. Natural gas exports to Mexico decreased 3 percent.

Pizza company stocks
It was a relatively rocky week for all but Domino's on the stock market last week. Domino's Pizza substantially grew in value on Wall Street last week, leaping up from a May 5 price of $193.13 to a May 12 price of $195.28 last Friday. Papa John's — in trading on the NASDAQ — also had a fruitful week, with a value of $82.06 at the close of trading Friday, or up 81 cents from the previous week's close. 

The news was not so nice for either Pizza Hut parent, Yum Brands, nor take-and-bake chain, Papa Murphy's. Both lost value last week, with Yum Brands dropping to $68.90, down 40 cents from the previous Friday's close and Papa Murphy's down to $4.82 Friday from $5.19 a week earlier. 


Topics: Business Strategy and Profitability, Financial Management, Financial News


S.A. Whitehead / Award-winning veteran print and broadcast journalist, Shelly Whitehead, has spent most of the last 30 years reporting for TV and newspapers, including the former Kentucky and Cincinnati Post and a number of network news affiliates nationally. She brings her cumulative experience as a multimedia storyteller and video producer to the web-based pages of Pizzamarketplace.com and QSRweb.com after a lifelong “love affair” with reporting the stories behind the businesses that make our world go ‘round. Ms. Whitehead is driven to find and share news of the many professional passions people take to work with them every day in the pizza and quick-service restaurant industry. She is particularly interested in the growing role of sustainable agriculture and nutrition in food service worldwide and is always ready to move on great story ideas and news tips.

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