Food & Beverage

Pre-election week leave lots to desire for pizza restaurateurs

As the national election approaches, everybody is feeling a little antsy in the U.S., and it's showing in the markets in which pizza restaurateurs most depend.

Photo: iStock

November 2, 2020 by S.A. Whitehead — Food Editor, Net World Media Group

As the election approaches in the U.S., everybody's feeling a bit antsy, including pizza operators, who watched their shares lose value as commodity prices climbed. The only real good news for consumers and restaurateurs alike was that pump prices remain low.

In pizza brand trading on Wall Street, the only gainer among the four companies Pizza Marketplace monitors was Texas-based, Rave Restaurant Group. The Pizza Inn and Pie Five parent company gained nearly 4 cents on the week to close Friday at just under 72 cents.

But losses were the order of the week for everyone else, beginning with Domino's, which dropped a hefty $15.78 over the week to end Friday at $378.32.

Louisville, Kentucky-based Papa John's also edged down slightly to close the week at $76.60, 14 cents lower than the previous week's close.

Pizza Hut parent, Yum Brands, recorded a loss of $5.20 on the week when it closed Friday at $93.33.

Cheese

The nation may be divided over who will lead it, but it's apparently united in its love for cheese, as demand for the commodity remains strong across all markets, including the pizza sector. One result of that is that the price of the commodity keeps growing.

The weekly average for barrels last week was nearly $2.48, up 13 cents from the previous week. Blocks were also up, but just 2 cents, to an average of just under $2.78. Barrels closed at $2.53, while 40-pound blocks ended at $2.78.

The U.S. Department of Agriculture reports that nationally, cheese production remains busy, with some Western manufacturers reported running plants over capacity and only taking downtime for maintenance.

Meanwhile, the U.S.D.A. said buyers are skittish. Some are speculating that cheese market tones have neared their near-term ceiling, though market prices have stalled slightly compared to weeks of bullish movements.

Wheat

Winter wheat prices fell in light of rain across the Southern Plains states that provided some let-up in drought conditions, but the look ahead remains dry in all but three Midwestern states.
Winter wheat contracts edged slightly lower, while spring wheat inched higher. December Kansas City hard red winter futures lost a half-cent to come in at just over $5.41.

On the Minneapolis Grain Exchange, December spring wheat futures gained slightly over a cent to come in at nearly $5.54.

Auto fuel

Over last week, the American Automobile Association said that the national average for a gallon of regular fell 2 cents to $2.14 at the end of the week. The U.S. Energy Information Administration said gas demand increased from 8.29 million barrels per day(b/d) to 8.55 million b/d.

The current estimate for demand is 1.23 million b/d lower than the rate at this time last year and that low demand — while domestic stocks decreased by 900,000 barrels to 226.1 million barrels last week — has helped pump prices decrease. AAA said that as demand remains low, American drivers should expect pump prices to continue to decline this fall.

By this morning, the average price for a gallon of regular nationally had dropped another cent for a total of 3 cents lower on the week to come today at just under $2.13 a gallon, AAA said. The price for mid-grade ($2.48) and premium ($2.75) each also dropped three cents from a week earlier.

Diesel was a cent lower on the week for an average of $2.36 this morning, while E85 dropped 4 cents over the week to clock in today at an average of $1.94.

The biggest declines in states' gas prices over the week occurred in Kentucky, Florida and Minnesota, where the average prices fell 4 cents on the week.

Natural gas

Natural gas spot prices rose at most locations for the seven days ending on Oct. 28, while the Henry Hub spot price rose from $2.86 per million British thermal units (MMBtu)to $3.06/MMBtu over the same period.

At the New York Mercantile Exchange, the November 2020 contract expired at just under $3/MMBtu, down 3 cents/MMBtu from the previous week. The December 2020 contract price decreased to $3.29/MMBtu, down 6 cents/MMBtu over the seven days.

The natural gas plant liquids composite price at Mont Belvieu, Texas, fell by 8 cents/MMBtu, averaging $5.15/MMBtu for the week ending Oct. 28. The prices of natural gasoline and ethane fell by 6% and 1%, respectively. The prices of butane and isobutane both rose by 1%. The price of propane 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.