has never been more
The
Perhaps nowhere is this more evident than in the volatile price of food.
interconnected.
world
How fine dining and agricultural futures markets are intertwined
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Watch the video to learn more.
ow does war in Eastern Europe make
it more expensive to grow corn in the Midwest? How does drought in the Southwest change restaurant menus in the Northeast? Where does inflation fit in with this all?
Restaurant managers, grocery store shoppers, and investors alike are all faced with the same challenge: understanding where price increases are coming from and identifying the best ways to adapt.
Here’s a look at how that plays out on menus and in the market.
With food prices rising around the world, maintaining a consistent dining experience is a major challenge for restaurateurs. Staying attuned to agricultural futures markets can help them make smarter menu decisions.
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Explore more about Agricultural futures and options offerings from CME Group.
CME Group traces its origins back 150 years to food producers seeking stability amid unpredictable gluts and shortages: Chaotic price fluctuations led to merchants, processors, and agricultural companies developing
a market to trade “forward” contracts. These contracts, the predecessors of modern futures contracts, reduced
the risks of adverse price movements, making it easier for them to plan long term, manage price risk, and stabilize impact to consumers.
Today, agricultural producers and end users use CME Group’s markets for the efficiency, transparency, and risk transfer potential needed to manage
the kind of pricing volatility so prevalent in recent years. CME Group’s agricultural products empower enterprises and investors to hedge risk, fine-tune exposure, and capture opportunities
and efficiencies in the market – as well as exclusive resources to broaden their expertise and identify emerging fundamental trends.
Here’s what you need to know:
In periods of economic volatility, futures markets help navigate risk and uncertainty.
CME GROUP RESOURCES
WHO CAN BENEFIT?
WHAT ARE AGRICULTURAL FUTURES?
Futures markets provide producers and other key parts of the supply chain with a method to hedge against pricing volatility and reduce its impact on end consumers.
To see the benefits of this stabilization in action, look no further than the comparison of
PPI and CPI for food.
CONSUMERS
An unrivaled array of opportunities to hedge, gain capital efficiency, and create new spread trading opportunities offers an invaluable means of managing risk.
INVESTORS
Spotting trends by way of understanding movement in futures options can provide an opportunity to get ahead of impending price crunches and plan accordingly.
RESTAURATEURS
Whether you’re an experienced institutional investor looking for an edge or a restaurant GM looking to learn the ropes, CME Group offers valuable and effective educational resources.
Courses and Resources
AG Economy Barometer
CVOL Index
Launched in partnership with Purdue University’s Center for Commercial Agriculture, the Ag Economy Barometer measures market sentiment via a monthly survey of 400 agricultural producers and a quarterly in-depth inquiry of 100 leading agriculture and agribusiness thought leaders. It’s
an essential tool for those looking
to deepen their understanding
of the industry’s health.
Ag Economy Barometer
Courses and Resources
CVOL Index
Using CME Group’s proprietary simple variance methodology, the CVOL Index is a first-of-its-kind representative measure of the market’s expectation of 30-day forward risk. CVOL Indexes are calculated both in real time
(every 15 seconds) and as an
end-of-day benchmark.
CVOL Index
AG Economy Barometer
Courses and Resources
H
How futures markets impact consumers
A wisely-run restaurant makes adjustments to keep prices consistent, so that diners don’t experience sticker shock. Here's how wholesale food price increases translate to the prices paid by end consumers.
PRODUCER PRICE INDEX
DINE-IN/ TAKE OUT
GROCERIES
PRODUCER PRICE INDEX
DINE-IN/ TAKE OUT
GROCERIES
PPI vs. CPI
Eggs vs. Milk
Making Connections
PPI vs. CPI
Average price of Grade A Large Eggs (Cost per dozen) in US Cities
Eggs vs. Milk
EGGS
MILK
MILK
EGGS
Futures markets can potentially reduce pricing volatility for consumers. Compare the pricing volatility of eggs (which has no associated futures contract) to that of milk (which does).
+25%
APRIL 2022
Average price of Fresh, Whole, Fortified Milk (Cost per gallon) in US Cities
+5%
APRIL 2022
Food providers who understand food ecosystems might see connections between different futures commodities. For example, corn is often used to feed cattle: a price increase in corn futures may therefore contribute to an
ensuing rise in beef prices.
Making Connections
Average Price of Ground Beef (Cost per Pound) in US Cities, Index Feb 2022=100
135
OCT 2022
107
SEPT
2022
CORN PPI
PRICE OF BEEF
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Hover on text below to view more
Perhaps nowhere
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PPI vs. CPI
Eggs vs. Milk
Making Connections
PPI vs. CPI
Making Connections
Eggs vs. Milk
PPI vs. CPI
Making Connections
PPI vs. CPI
Eggs vs. Milk
Making Connections
CVOL Index
AG Economy Barometer
Courses and Resources
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Sponsored content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Insider's editorial staff is not involved in the creation of this content. Copyright © 2023 Insider Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our Terms of Service, Privacy Policy and Cookies Policy.
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CREATED BY
Sponsored content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Insider's editorial staff is not involved in the creation of this content. Copyright © 2023 Insider Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our Terms of Service, Privacy Policy and Cookies Policy.
Contact Us | Sitemap | Disclaimer | Accessibility
Commerce Policy | CA Privacy Rights | Coupons Made in NYC | Jobs
THE FUTURE OF
Resturants
Resturants
THE FUTURE OF
How fine dining and agricultural futures markets are intertwined
Eggs vs. Milk
Making Connections
