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.
There were no big surprises in last week’s monthly WASDE report.
Corn ending stocks for 2012–2013 remain extremely tight with the stocks-to-use ratio at a near-record low of 6.5 percent. However, the USDA continues to project a potentially record-large 2013–2014 corn crop.
Old-crop cash market corn prices are sky high at close to $7.00 per bushel. Conversely, the new-crop December corn futures contract closed at $5.09 on Friday, not far off the USDA’s $4.80 forecast.
Summer weather will be the main driver of price going forward. Sixty-eight percent of the corn crop is in good-to-excellent condition, but rain will be critical to maintaining and improving that number.
The USDA slashed its forecast of world wheat supplies due to worsening drought conditions in Russia. The organization also dropped 2013 U.S. beef output to 2.2 percent below 2012 levels. 2014 beef production is projected to decline by 4.9 percent.
Contact John T. Barone at [email protected].