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Domino's, Yum stock prices push up

Pizzeria operators probably suspected those lower gas prices wouldn't last. Now tight supplies are pushing auto fuel prices up, while wheat prices also rose last week. The same could not be said for Papa John's, which was the only pizza brand monitored here to lose value last week.

July 15, 2019 by S.A. Whitehead — Food Editor, Net World Media Group

Proof that it really may all even out in the end comes today from the pizza commodities and stock trading activity last week, where although everything from wheat to auto fuel became more costly last week, so did the value of most of the brands on Wall Street. 

Cheese

The exception to the higher commodity prices of last week came from cheese markets, which were down slightly at the Chicago Mercantile Exchange where the weekly average for barrels was down 2 cents to $1.76, while the average paid for blocks was off 3 cents to $1.83, according to the U.S.D.A. Agricultural Market News Service. At the close of trading last week, barrels ended up at $1.74, while 40-pound blocks came in at $1.79. 

Nationwide, U.S.D.A. industry contacts have reported that though while milk supplies may be tightening somewhat, cheese vats are getting filled. Milk loads, however, are readily available for making cheese and production is active, with many processors working to stay ahead of late season demand. 

Cheese inventories are adequate to meet most buyer needs and some U.S.D.A. contacts report that there is a lot of mozzarella in Western U.S. warehouses.

Wheat

Compared to last week, cash bids for wheat was mostly higher, though Dark Northern Spring Wheat was lower. Overall, wheat was 18 3/4 cents lower to 17 1/2 cents higher.  

Kansas City U.S. No. 1 Hard Red Winter, ordinary protein rail bid was 17 1/2 cents higher, from $5.53 1/4-$5.63 1/4 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 8 cents higher, from $5.19-$5.22 per bushel. Minneapolis and Duluth U.S. No. 1 Dark Northern Spring, 14.0 to 14.5 percent protein rail, was 8 3/4 to 18 3/4 cents lower, at $6.21 1/4 per bushel. Portland U.S. Soft White wheat rail was steady to 5 cents higher, from $5.75-$6.13 per bushel.

Vehicle fuel

Fireworks weren't the only thing that shot up on July 4, so did gas prices, according to the U.S. Energy Information Administration. The American Automobile Association adds that increased demand for fuel, combined with decreasing gas stocks, have helped push the pump numbers higher. 

The current average for a gallon of regular is up 4 cents from last week to $2.79, which is also 9 cents higher than last month, but 9 cents lower than last year, AAA said. The same trend continued across mid-grade ($3.11), premium ($3.36) and diesel ($3.10) within fluctuations of a cent or two. In fact, even E85 followed the basic upward tick, averaging $2.45 this morning, which is 4 cents higher than last week, 11 cents above last month, but in the case of E85, actually also above last year's price of $2.43. 

Natural gas

Natural gas spot prices rose at most locations for the seven days that ended July 10, according to the U.S. Energy Information Administration. Henry Hub spot prices rose from $2.24 per million British thermal units (MMBtu) to $2.46/MMBtu over the same period. 

At the New York Mercantile Exchange, the price of the August 2019 contract increased 15 cents, from $2.29/MMBtu to $2.444/MMBtu over the seven-day period. The price of the 12-month strip, averaging August 2019 through July 2020 futures contracts, climbed 14 cents/MMBtu to $2.575/MMBtu.

Net injections to working gas totaled 81 billion cubic feet (Bcf) for the week ending July 5. Working natural gas stocks are 2,471 Bcf, which is 13% more than the year-ago level and 5% lower than the five-year (2014-18) average for this week.

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 7 cents/MMBtu, averaging $4.53/MMBtu for the week ending July 10. The prices of ethane and propane fell by 5% and 2%, respectively. The prices of isobutane, butane, and natural gasoline rose by 15, 7 and 3%, respectively.

According to Baker Hughes, for the week ending Tuesday, July 2, the natural gas rig count increased by one to 174. The number of oil-directed rigs fell by five to 788. The total rig count decreased by four, and it now stands at 963.

Pizza company stocks

For two of the three large publicly traded pizza stocks watched here weekly, the five days after Independence Day week also had a nice "bang" to them, as both Domino's and Pizza Hut parent, Yum Brands experienced notable lifts in value last week. 

Domino's was the big winner of the trio, watching its stock price push all the way up to $282.11 at the close Friday, a nice $3.89 over the previous week's close of $278.22. But, Pizza Hut's parent company didn't do too poorly either, when its stock closed Friday $111.05, 82 cents higher than the previous week's close of $110.23.

But Louisville-based Papa John's International, Inc. faltered a bit last week, dropping from $46.35 at the close on July 5 to $45.92 last Friday at the close on the Nasdaq. 

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.