In this weekly Commodities Watch column, John T. Barone, president and commodities analyst for Market Vision Inc., offers a snapshot of the state of commodities for restaurants.
With the government shutdown cancelling October’s WASDE report, it had been two months with no USDA data prior to Friday’s report.
Traders have been bidding down corn prices for months on expectations of a record-large corn crop and on rumors that the U.S. Environmental Protection Agency will reduce corn-based ethanol mandates. Corn futures that were still $7.17 per bushel in July dropped all the way to $4.20 on Thursday.
The USDA’s report estimated production at a record-high 13.989 billion bushels, but that was still less than expected, so corn futures recovered to $4.26 on Friday. Even so, corn supplies will be huge, and this market is going nowhere.
Soy oil futures dropped to $.4024 per pound on news that the U.S. Food and Drug Administration will no longer recognize partially hydrogenated vegetable oils as “Generally Recognized as Safe.” This might be as good as prices get this year.
Contact John T. Barone at [email protected].