Operations

Pizza Hut parent powers forward in trading

Aside from Pizza Hut parent, Yum Brands, traders pulled back from pizza stock purchasing last week — a particularly disconcerting trend for Pie Five and Pizza Inn.

Photo: iStock

August 31, 2020 by S.A. Whitehead — Food Editor, Net World Media Group

Most of the publicly traded pizza brands watched weekly by Pizza Marketplace fell in value last week, save Yum Brands Inc., which owns Pizza Hut. In fact, Pie Five and Pizza Inn parent, Rave Restaurant Group Inc., continued to plummet in value, even as it faces possible delisting on the Nasdaq.

Rave closed Friday at 49 cents, down 7 cents from the previous week's close. The seemingly infinitely soaring Domino's also fell $3.72 in value over the week to close Friday at $415.98, while well-performing Papa John's also lost 95 cents to close at $98.62.

The bright spot came from Yum, which pulled out at a $1.35 increase in value to close Friday at $97.45.

Cheese

Cheese prices were up, despite softening demand from foodservice. The U.S. Department of Agriculture reported that barrels averaged 5 cents higher, coming in at $1.42, while 40-pound blocks were up nearly 10 cents on average at $1.83. Barrels closed Friday at $1.43, while blocks ended at $1.83 on the Chicago Mercantile Exchange.

Both Midwestern and Western cheesemakers reported having a larger cheese supply, due to lighter demand. Foodservice demand, in general, is somewhat soft nationwide as more at-home schooling decreases school lunch demand for the commodity, the U.S.D.A. said.

Milk supplies remained robust for cheese production, and overall market tones have been stronger after a substantial decline in prices in early August. In the U.S., domestic prices for Parmesan, and Romano have fallen 6 cents, however.

Finally, under the topic of pizza cheese, remember that Saturday, Sept. 5, is National Cheese Pizza Day (yes, there is such a thing), which several chains are celebrating. For instance, at Fired Pie, the brand is offering half off cheese pizzas with the purchase of any drink at 21 locations of the fast-casual concept.

Wheat

The 2020 U.S. winter wheat harvest is nearly complete, the U.S.D.A. said, with only crops in Montana and the Pacific Northwest still to harvest, where overall conditions were above average. Also in the Pacific Northwest, the soft white harvest made strong progress last week due to good field conditions.

All that said, the prices for wheat, which have been trending upward since early this month, were a mixed bag. September Chicago soft red winter futures dropped 3 cents to just under $5.40, while September Kansas City hard red winter gained 1.5 cents to come in at $4.62.

Auto fuel

Over the business week last week, gas prices ticked up an average of 4 cents nationally to $2.22 average price per gallon Friday, though that's still 36 cents below what we paid last year at this time. The American Automobile Association said the price gains are attributable to a combination of heightened demand and the presence of Hurricane Laura in the Gulf of Mexico, where many oil rigs are situated.

In the new weekly report from the U.S. Energy Information Administration, gas demand increased from 8.63 million barrels a day (b/d) to 9.16 million b/d — one of the highest recorded rates of the year. However, last week's estimated rate is still 739,000 b/d lower than the rate last year at this time.

Additionally, total domestic gasoline supplies decreased by 4.6 million barrels (bbl) last week to 239.2 million bbl, but the current level is 7.2 million bbl higher than the level at this time last year.

As demand jumped last week, prices followed in advance of expected production and distribution disruption for refineries in the Gulf, AAA said. Nonetheless, lower than usual demand and relatively ample stock levels are expected to contain any significant pump price increases to impacted areas.

This morning, the average price of a gallon of unleaded gas in the U.S. clocked in at $2.23, up 4 cents from the previous week and month. Mid-grade ($2.57) and premium ($2.84) followed the same arc over the last week and month.

Nationally, the price of diesel averaged $2.43, up a penny from last week, but flat with the price a month ago. E85, at $2.01 on average nationally, was 3 cents higher than the price last week or last month, AAA said.

Natural gas

Natural gas spot prices rose at most locations for the seven days that end on Aug. 26 according to the U.S. Energy Information Administration. The Henry Hub spot price rose from $2.36 per million British thermal units (MMBtu) to $2.51/MMBtu over the same seven days.

At the New York Mercantile Exchange (Nymex), the price of the September 2020 contract increased 3 cents, from $2.43/MMBtu to $2.46/MMBtu, while the price of the 12-month strip (averaging September 2020 through August 2021 futures contracts) declined 1 cent/MMBtu to $2.85/MMBtu.

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 1 cent/MMBtu, averaging $5.19/MMBtu for the period. The prices of propane and isobutane fell by 1% and 2%, respectively. The prices of ethane and butane rose by 1% and 3%, respectively. The price of natural gasoline remained flat week over week.

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.