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State of Corn Prices: Wholesale Restaurant Food Cost Trends

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Justin GuinnAuthor

Few ingredients are as ubiquitous in the food industry as corn — making corn prices hugely influential for restaurant profitability. 

From corn syrup to tortilla chips, corn is a versatile ingredient used in countless dishes. Fluctuations in the restaurant supply chain and corn prices can make it challenging to predict ingredient costs and manage budgets effectively. 

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We're able to calculate the average monthly prices that eating establishments pay for corn by using proprietary data from xtraCHEF by Toast, our invoice automation and recipe costing tool.

The average national price that restaurants paid for a pound of corn is $1.46 in August.

Here's a breakdown of historical data on wholesale restaurant corn prices in the last year:

Restaurant corn prices have been steady over the past year — fluctuating no more than 5% month-over-month in either direction.

Here's a breakdown of recent month-over-month fluctuations in the price of corn for restaurants:

Commodities experts weigh in on corn prices

We were able to speak with some experts in the food commodities space to understand their analysis on corn price trends and the impacts on restaurants. 

Question

How should restaurant owners expect wholesale corn prices to trend into 2024?

There’s good news for wholesale corn prices. This year set a record corn planting season. The U.S. planted 94 million acres, up over 4 million acres from last year. Estimates indicate 87 million acres will be harvested, which is still a large number. The unusual record heat reduced the yield for the U.S. producers, but the sheer number of acres will still produce over 15 billion bushels. This expected large volume, coupled with an increasingly strong Brazilian export, will keep corn prices around $5/bushel for the foreseeable future.

Tim Luginsland
Tim Luginsland
Wells Fargo Agri-Food Institute

Where does most US corn come from?

Most of the US corn supply for the restaurant supply chain is grown domestically within the country. 

The major corn-producing states in the US include Iowa, Illinois, Nebraska, and Minnesota. These states, located in the Midwest region, have optimal climatic conditions and fertile soil for corn cultivation. Iowa stands out as the largest corn-producing state, known for its vast cornfields and high crop yields. 

Additionally, the US imports a significant amount of corn from neighboring countries, including Canada and Mexico. However, when it comes to domestic corn production, the Midwest states contribute the most to the US corn supply.

Can restaurants substitute corn and soybeans?

While corn and soybeans are both versatile ingredients, substituting one for the other in recipes may not always yield the desired results. 

Corn has a unique flavor profile with its natural sweetness and distinctive texture, making it suitable for dishes like cornbread, tortillas, or corn-based snacks. 

On the other hand, soybeans have a nutty and savory taste, commonly used in various forms such as tofu, soy milk, or soy sauce. 

While chefs can explore alternative ingredients, substituting corn for soybeans or vice versa may significantly alter the taste, texture, and overall character of a dish. It is best for restaurant chefs to consider the specific culinary requirements and flavors of each recipe before attempting any substitutions.

Why is corn included in so many processed foods?

Corn is a highly versatile crop that lends itself well to various food manufacturing processes, making it a popular ingredient in numerous processed foods. 

Corn is commonly used to produce corn syrup, cornstarch, and corn oil, which are widely utilized as sweeteners, thickeners, and cooking oils in the food industry. 

Additionally, corn is a primary ingredient in the production of products such as cornmeal, tortilla chips, cornflakes, and corn-based snack foods. Its availability, affordability, and ability to add texture, flavor, and sweetness make it an attractive choice for processed food manufacturers.

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Commodities 101: Trading agricultural commodities, commodity prices, and corn futures

Understanding the basics of trading and commodity prices can be beneficial for restaurant owners and operators seeking to manage their corn costs effectively.

Commodity prices, including corn, are determined by supply and demand dynamics on global markets. Governments and organizations like the United States Department of Agriculture (USDA) closely monitor corn production data, weather patterns, and global demand to forecast future prices. 

Additionally, commodity trading involves the buying and selling of contracts for future delivery of corn, known as corn futures. These futures contracts allow producers and buyers to lock in prices in advance, helping both parties manage their price risk. 

By keeping an eye on corn futures and historical data, restaurant professionals can make informed purchasing decisions and potentially mitigate the impact of price fluctuations.

Impact of the wholesale price of corn on different foods

The wholesale price of corn plays a significant role in the cost structure of various food products served in restaurants. 

Corn is a key ingredient in many foods, including corn tortillas, cornbread, cornstarch-based sauces, and corn-fed livestock products. 

Fluctuations in the price of corn can directly impact the cost of these food items. For instance, if the price of corn increases due to factors such as crop production issues, increased demand, or changes in government policies, restaurants may experience higher costs for items like corn tortillas, which can affect the profitability of menu items like tacos or enchiladas. 

It is crucial for restaurant owners and operators to closely monitor the price of corn and adjust menu pricing or sourcing strategies accordingly to mitigate the impact on their bottom line.

Types of corn and their uses for restaurants

Within the corn family, different types offer varying characteristics and applications for restaurant owners and operators.

Some common types of corn used in the food industry include dent corn, sweet corn, and popcorn. Dent corn is the most widely grown type and is primarily used for animal feed, processed foods, and for producing corn-based products such as cornmeal and corn oil. Sweet corn, with its tender and sweet kernels, is commonly enjoyed as a vegetable side dish or used in salads, soups, and salsas. Popcorn, as the name suggests, is specifically bred for popping and is a popular snack in movie theaters and at home. Understanding these different types of corn and their specific uses can help restaurants optimize their ingredient choices and menu offerings to cater to specific culinary preferences and customer demands.

Corn growers across the world

Argentina, Brazil, and Canada are countries known for their significant corn production and cultivation. 

In Argentina, corn cultivation is concentrated in the fertile Pampas region, where favorable weather conditions and agricultural practices contribute to high yields. The country is a major exporter of corn, supplying markets worldwide. 

Brazil, with its vast agricultural lands and favorable climate, is another prominent corn producer. The country has become a leading exporter of corn, thanks to advancements in technology and increased production efficiency. 

Canada, although better known for its wheat production, also has a substantial corn industry. Corn cultivation in Canada is concentrated in the southern regions, where the climate supports its growth. The country primarily produces corn for livestock feed and ethanol production.

These international corn-producing countries play a vital role in global corn markets. Their production capacity, along with the United States, influences the overall supply and pricing of corn in the international market. 

Events such as weather-related issues, trade policies, and changes in demand from countries like China, can impact the global corn market and have a ripple effect on corn prices worldwide. As such, keeping an eye on corn production levels and trends in these countries is important for restaurant owners and operators to anticipate potential fluctuations in corn prices and adjust their sourcing strategies accordingly.

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Use this guide to learn more about your restaurant invoices, the value within, and how to consistently and accurately tap into it to make smarter decisions.

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Start tracking corn prices today

Restaurant operators don’t want their profits to pop like corn. That’s why they should consider having a strong back-of-house foundation built on invoice automation.

Invoices are the single source of truth for restaurant costs — pinpointing prices and fluctuations for individual ingredients as well as paper goods, non-alcoholic beverages, and more.

With accurate and up-to-date ingredient prices from invoices, operators can start calculating plate costs. Plate costing is a detailed exercise that zooms into the recipes and/or individual ingredients that make up a dish — requiring detailed recipe costs and portion costs for ingredients.

Costing exercises can help show how each component is contributing to the overall profitability of a dish or drink. And recipe costing software can help make it easier to calculate and achieve an ideal balance between portions and profits.




Methodology

Toast analyzed monthly invoice items for corn from restaurants using xtraCHEF by Toast. Items are weighted by the frequency of orders, not quantity. A standard unit of measure is determined so that an average price can be calculated across all invoice inclusions of the ingredient.

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