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.
Friday’s USDA dairy report showed U.S. milk output maintaining a strong pace, up 3.2 percent in April compared to a year ago. But that’s still a decline from the 5.1-percent average growth for the first quarter of 2012. The USDA projects milk output growth slowing to 2.6 percent (above a year ago) in the second quarter and 1.7 percent in the second half of 2012.
The block cheese market (currently $1.50) has traded in the $1.49 to $1.53 range since late March but is likely at a seasonal bottom and headed for the $1.60 range (on average) in the third quarter. Even so, that’s just a shadow of the third quarter of 2011's record-high $2.04 block average.
Separately, Friday’s USDA cattle report showed feedlot inventories at 11.1 million head, down from 11.5 million last month and 1 percent below a year ago. New feedlot placements in April were 15 percent below last year. The gap in calf supplies, precipitated by last year’s herd-liquidating drought in Texas, will persist through 2012.
Contact John T. Barone at firstname.lastname@example.org.