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.
Block cheese prices have rebounded since bottoming at $1.6375 per pound in late June, but they have been stalled in the $1.77-1.78 range for the past two weeks. This price plateau looks to only last another week or two before cheese heads to higher elevations. June cheddar production was up from a year ago, but 4.9 percent lower than in May. Cheese stocks in cold storage were also lower in June, compared to May, and indicate that cheese demand has picked up.
Bullish dairy market fundamentals — summer heat, strong global prices, and seasonal demand — will pressure dairy prices higher in September and October. But lower feed prices are expected to encourage higher U.S. milk and dairy products output, leading to lower prices by November and for the first half of next year.
Cheese futures prices are trading at $1.81 for September and October, $1.75 for November, $1.69 for December and average $1.64 for the first quarter of 2014.
Contact John T. Barone at [email protected].