Bookings of bakery flour expanded last week. Prices were mostly stronger.
Individual bakers took advantage of an early-week break in wheat futures prices to fill gaps in December-January coverage and make minor additions to first-quarter ownership. Business was not as heavy as one might have expected considering the price decline, but many bakers booked what they felt they had to before the Thanksgiving break. Additionally, particularly in the case of those who already covered much of their first-quarter flour needs, there were ideas wheat prices ultimately must succumb to overwhelmingly bearish fundamental features prevailing in U.S. and world wheat markets.
Specialty bread bakers and other users of spring grades again covered the futures component of prospective flour bookings deep into 2010. Most of this business was done early in the week.
Wide declines in millfeed prices made it less attractive to bakers who in recent weeks were fairly aggressive in covering that component of future flour bookings.
Estimates of pan bread flour coverage for the first quarter of 2010 averaged about 50%. Soft flour coverage was more extensive with cookie-cracker and specialty bakers heeding the advice of millers who urged bookings deep into 2010 because of widespread quality issues with the 2009 crop and expectations of a sharp reduction in soft wheat plantings.
Mill grind declined during the holiday-shortened week. Grind was three to four days in the Southwest and Southeast, less than four days in the Upper Midwest, four days in the Central states, four to five days-plus in the Northeast and a shade more than four days on the West coast.
Sales of national and regional brands of family flour declined last week going into the Thanksgiving weekend. Carlot list prices were unchanged.
Shipments were steady up to the holiday and were expected to resume a brisk pace a few weeks before Christmas as manufacturers indicated grocers and other outlets planned product promotions for the yearend holiday period. Several instances of two 5-lb bags of family flour offered at $3 were noted, and product promotion overall was more active in the current season than in the past few.
It was expected family flour shipments and sales will drop sharply in January and revert to the routine until the approach of Easter, another holiday that sees an increase in home baking.
In the market for private label flour, most grocers and other buyers were comfortable with coverage extending through March or even June. Those who were yet to cover needs for those months waited for weaker wheat prices.
Bookings of semolina, granulars and durum flour were light last week. Prices were raised 50c a cwt.
The upward adjustment in the semolina
price reflected a higher price of choice milling hard amber durum in Minneapolis, which moved up 10c from the previous week to $5.90 a bu, and weaker millfeed prices. The durum price was considered nominal with trading in the spot market lacking. Mills purchased durum on a to-arrive basis heavily around harvest time, and shipments of durum on contract have sustained pipelines.
With semolina and durum prices holding well below year-ago levels and large crops with good quality harvested both in the U.S. and Canada, pasta manufacturers exhibited little fear the market would run away from them. Semolina coverage already was extensive. Most pasta manufacturers earlier covered about 80% of their semolina requirements for the first quarter of 2010, and April-June coverage was estimated at around 30% to 40%.
Semolina shipments began to slow in November. It was uncertain how much of the slowdown was due to seasonal factors, but business has been remarkably brisk throughout 2010 with many pasta manufacturers posting excellent volume and dollar sales results. Pasta earned its reputation as being a staple for home cooking during economic hard times.