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$3/pound cheese?

perfect_pizzas

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Has anyones’s cheese price hit $3/pound yet? The block market has risen from $2/lb. on December 20th to $2.27/lb. yesterday WITHOUT A SINGLE TRADE TAKING PLACE! No reason the price manipulation will stop any time soon. Today or tomorrow should hit an all time high at a time of year when we are typically seeing cheese prices low and dropping.
 
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Mine has hit 2.89, I received a copy of a letter my supplier received talking about CHINA !!! ???

China I ask WHY…
 
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When I posted about this a couple of weeks ago asking if anybody was planning to make changes because of cheese prices, only perfect pizzas, RG and paul7979 replied. I thought it would be a much bigger deal to everybody!

Sustained at this price, it will shave about $15,000 off my profit for this year. I have to grow sales about 7% just to make up for the increase in cheese price. 7% sales growth for a 10 year old business is a tall order, and that’s just to get back to what I made last year.

We are reeling in some discounts, and a couple of menu items are being increased. I’m working on new menu artwork now. When this happened in 2008 I kept thinking that prices would come down any day, and they never did. 2008 was a huge sales year for me, but my profit sucked because I didn’t react to the cheese and flour prices quickly enough. That’s not going to happen this time!
 
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We paid 2.38 last week for LMPS. Next week its going to be 2.41

oh boy, im sure it will go down it always does
if it doesn’t start to drop in 3-4months I will raise prices

which I hate doing.
 
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Piper,

I’m sure Grande & Bacio are already north of $3.00 a block, add $.20 cents extra if its shredded. I’m praying the price comes back down…

If it stays in this range for the entire year, I’ll spend an extra $40K+ just on cheese. Without price increases, that’s $40K LESS profit at the same business level. I cannot imagine selling a $5 pizza under this kind of pressure.
 
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We all know who can afford to make little profit (or even eat losses) the longest - and it’s not the single store operators or even the small (2-10 stores) operators. The bigger guys can just sit by and watch the other drop like flies - then the price of cheese will plummet.
 
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I bought quite a bit of cheese when it was 2.15lb at my local Restaurant Depot because that morning price per block hit 2.20 and I bought them out (about 5 weeks worth for me… so im about halfway through it). My truck screamed bloody murder on the way home but it made it without the axles snapping. :lol:

Say what you will about franchisees but I know a Little Caesars guy who is not happy, LC told him months ago cheese should stay fairly low. I know it hurts him a bit with franchise costs on top of the $5 model and he’s not exactly rich to begin with. He tells his employees what I tell mine… sell add-ons, add-ons, and than sell some more add-ons. Focus more on salads and desserts and less on anything with cheese on it (knots, cheese bread, etc).

Stay the course for as long as I can, and hope it goes down. Thankfully my LMPS cheese is not as spendy as some of the higher end cheeses you guys are using.
 
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Up another 1.5 cents today. Another new record high at $2.31. They at least traded two loads today to make it look less “fixed”. We need another investigation to find out if the dairy farmers in america are manipulating the market again and if they are acting alone or if they have partners in crime!
 
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it’s not the dairy farmers…allegedly it’s Big Dairy who manipulates the market. Kraft, Land O Lakes, et al. That’s the report I received from a vendor. Now, the China market certainly will affect things, I’m not downplaying that. The other thing that affects is the US Budget, the infamous Farm Bill. We avoided it this last time around, but look out if the politicians can’t learn to play well together.

We use both US Food and PFG, our USF is right at $3, our PFG about 30¢ cheaper.

This wave is as much due to the cold weather as it is China. But they use any excuse to break us.
 
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If there were dozens of trades each day I could buy into all of the BS excuses I have heard throughout the years as to the increases in the block market. However, when we go a month WITHOUT A SINGLE TRADE, how can this be looked at as a true exchange that reflects supply and demand pricing. The CME exchange in the case of block cheddar is nothing but a place to list a daily price that the powers that be feel the people in this country should pay for cheese. Ther has to be a better way And if anyone doesn’t think this market is being manipulated, do a little research into Dairy Farmers of America.

http://www.nytimes.com/2008/12/17/busin … .html?_r=0
 
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I have been paying the equivalent of $4.34 per pound since the government introduced the reduced rate for pizzerias a while back. Before the government stepped in the prices were up around the $4.95 mark.

There was a loop hole that a couple of the chains were exploiting where they would bring in cheese with other ingredients and called it a “pizza kit” to bypass the import duties on cheese. They saved millions until the hole was plugged.
 
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Currently paying $3.98 equivalent and it is a VAT exempt product meaning it does not get written off on our expenses. Summer prices will dip to 2.35 if not I am increasing prices like jokr and keeping our percentages in line.
 
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sheesh! and I thought I was paying a lot at $2.50 last week well see how badly I get raped this week.
 
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I think vendors should reduce our “over-block” amount so we are not the only ones feeling this. My guess is that will never happen.
 
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CME up another penny to $2.32/lb. I hear propane is at record highs up there in cheese country. Perhaps that’s the relationship…
 
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Or perhaps “they”, the traders, can “set” the price wherever they feel like it. It’s not like any cheese traded today. Why couldn’t “they” bid 20 cents higher tomorrow? This is nothing but a sham of an exchange. Too think that most of the cheese sold in America is priced based on an exchange that has had two trades in the last month is absurd. To make it worse, this so called exchange also affects the price of milk sold in America. As the cheese market moves, so do milk futures.
What pisses me off is that it is the pizza shops getting screwed by this. The distributors don’t care. They raise their prices weekly and make a bigger profit on the old invetory in a rising market. In a falling market, you can bet they wait to lower their price until new inventory comes in. Manufacturers don’t care. They pay more for milk but sell cheese for more. I would bet they make as much, or more, on each pound of cheese. Because we can’t raise our menu prices weekly, we are the ones getting the shaft in a market like this.
There are only 3 things we can do.
We can complain and write letters to politicians, asking that the CME be investigated for unfair trade practices.
We can measure or weigh our cheese. If each one of us used 10 percent less cheese, it would affect the manufacturers and the distributors. It may even cause an oversupply of milk which might contribute to price decreases.
We can carefully examine our menus, raise prices where they need to be raised, and push items which don’t require cheese to try to remain profitable.
 
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Perfect - Where are you getting the info that there were only 2 trades? And 2 trades of what?

I’m not sure what the cheesereporter is reporting exactly - but if you go to the CME website and look at the cheese futures, you will see that more than 2 trades have taken place recently. And that futures market is where the price comes from.
 
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