Food & Beverage

Pleased pizza investors pump up prices of publicly held brands

The pandemic has proven that people will get their pizza come hell or high water, and that's continuing to prompt pizza company investors to take positive action, helping pump up prices on publicly held brands.

Photo: iStock

June 1, 2020 by S.A. Whitehead — Food Editor, Net World Media Group

Pizza restaurant company investors were feeling confident last week, as their trading activity over the shortened Memorial Day week sent all four of the major publicly traded pizza brands watched here weekly, up in value over the four days. International pizza giant, Domino's added $13.74 in stock value over the week, closing Friday at $385.84, while Louisville, Kentucky-based competitor, Papa John's inched forward about 19 cents over the four days to close at $77.89 Friday. 

Pizza Hut parent, Yum Brands, added $2.48 on the week, to close May 29 at $89.73. Dallas, Texas-based Pie Five and Pizza Inn parent, Rave Restaurant Group, also added 3 cents on the week to close at 90 cents Friday. 

Cheese

Like most of the main pizza commodities last week, cheese trading continued its bullish pace, with the weekly average paid for barrels up 12 cents to $1.95, while the average for blocks added a hefty 20 cents on the week, to settle in at $2.09 according to the U.S. Department of Agriculture. Closing values for barrels last week was $2.02, while 40-pound blocks closed at $2.23, the U.S.D.A. said. 

Nationwide, cheese are relaying positive demand, although some Midwestern cheese makers are concerned about current cheese market prices, including block prices that broke the $2 mark last Thursday and kept going. Cheese producers told the U.S.D.A. that they expect these prices may give buyers some apprehension in the near term. 

Cheese inventories are somewhat tight across the regions, as ordering has been robust of late. All said, current cheese market tones are resoundingly bullish.

Wheat

Compared to last week, cash bids for wheat were mostly higher, ranging from 7 cents lower to 26 1/4 cents higher. Kansas City U.S. No. 1 hard red winter, ordinary protein rail bid was 11 ½ cents higher, from $5.56-$5.66 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 2 cents lower at $5.34 per bushel. Minneapolis and Duluth U.S. No.1 dark northern spring, 14 to 14.5% protein rail, was 26 1/4 cents higher at $6.59 1/4 per bushel. Portland U.S. soft white wheat rail was 7 cents lower to 1 cent higher, from $6-$6.10 per bushel.

Auto fuel

Over the week, last week, the national average for a gallon of regular gasoline held steady at $1.96, up 4 cents from the previous week and 20 cents higher than a month ago. Nonetheless, looking at the longer term, that price is still 86 cents under what it was a year ago at this time, according to the American Automobile Association. 

Demand for the product not only grew, but was accompanied by a 700,000-barrel decrease in total domestic stocks to 255 million barrels, according to the U.S. Energy Information Administration. The national average holding steady means that gas demand and supply are largely in sync, AAA said, which will likely help to stabilize pump prices.

The largest weekly increases in gas prices were seen in Colorado (+15 cents), Alaska (+11 cents) and Idaho (+10 cents), followed by Michigan (+9 cents) and South Dakota (+8 cents), as well as Arizona and Utah (+7 cents each) and New Mexico, Oklahoma and North Dakota (+6 cents).

The national average for a gallon of regular unleaded this morning up another 2 cents to $1.98, AAA said, with mid-grade ($2.33) and premium ($2.59) also each up about the same amount. Prices for diesel were flat from last week at $2.41, while E85 was up a cent at $1.85 on average this morning. 

Natural gas

Natural gas spot price movements were mixed for the last seven-day period of complete records that ended May 27, though the Henry Hub spot price fell from $1.83 per million British thermal units (MMBtu) to $1.72/MMBtu over that same period.

At the New York Mercantile Exchange, the June 2020 contract expired yesterday at $1.72/MMBtu, down 5 cents/MMBtu over the period. The July 2020 contract price decreased to $1.89/MMBtu, down 2 cents/MMBtu. The price of the 12-month strip, averaging July 2020 through June 2021, futures contracts declined 1 cent/MMBtu to $2.451/MMBtu.

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 8 cents/MMBtu, averaging $4.36/MMBtu for the period. The price of natural gasoline fell by 1%. After significant increases in previous weeks, the price of ethane fell 10%, but remained almost twice the price of natural gas on an energy-equivalent basis versus the Henry Hub spot price. The prices of propane, butane, and isobutane rose by 9%, 10%, and 12%, respectively.

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.