September, 2016 – Looking to Our Future

Skidmore is excitedly looking to our future! Many projects that are key to our success are in full swing. These activities are vital to our long-term commitment to continue to provide the timely, accurate, and personalized service that Skidmore customers value. As mentioned in a previous newsletter, this past spring we completed an expansion of our primary distribution center in West Chester, Ohio, adding nearly an additional 100,000 square feet of new warehouse space to our facility. That was just the beginning.

Construction crews broke ground this month on the long-anticipated expansion of our corporate headquarters also in West Chester, Ohio. When completed, this expansion will double the current work-space for Skidmore’s functional departments, allowing for more team collaboration and new additions of key personnel within each of the departments. “Providing top-rate customer service and the highest quality food ingredients have made Skidmore a first choice distributor for more than 50 years. We are committed to the growth of our suppliers and customers. This investment in our future will allow us to grow with them, and it ensures that we will continue to provide the resources they need, even in the most challenging markets,” Jim McCarthy, Skidmore President, stated.
The momentum doesn’t end there! Crews are also putting the finishing touches on our expanded re-pack operations. This investment will create an enclosed GMP zone and provide nearly 50% more production capacity, and additional space for future expansion. Additionally, a centralized warehouse office is being constructed that will “enhance our food safety and defense programs while providing more opportunities for continued growth,” explained Mark Overbeck, Skidmore Vice President of Supply Chain.

To support the Customer First mindset that Skidmore team members are known for, we are also nearing our “Go Live Date,” for our new enterprise resource planning (ERP) system. This system will support all departments within our infrastructure by providing access to key customer information with just a few keystrokes. “We’re implementing Sage X3 ERP offering us tremendous capacity and flexibility to meet service requirements. Enhanced document management features streamline our process for documentation requests which our customers will appreciate. Access to information from mobile devices will provide to our sales team instant access to ­­­­­online inventory, pricing, and account information from tablets and phones. ” added Jay Couzins, Skidmore Director of Business Intelligence.

We are excited to share the continued progress of these important projects and we are confident customers will begin to see the benefits in the coming months. If you would like to learn more about these endeavors, and how Skidmore can help your business grow, please contact your Skidmore representative.

September, 2016 – New Employee Announcement

Skidmore is excited to welcome Tess Jones to our team.  Tess joined Skidmore in September as an Inside Sales professional.  Her extensive background in food quality management in manufacturing, and food science; coupled with her passion for assisting customers will prove to be great asset to Skidmore customers.
“I’m eager to turn the focus of my career to sales, and begin to develop relationships across my customer base. My product development background will help me find the best ingredient solutions for my customers’ most challenging problems,” Tess explained.

September, 2016 – Commodity Forecast

The Corn harvest is just getting underway with approximately 9% of the US corn harvest complete.   The condition of the crop is slightly better at this point compared to last year, with 74% of the crop rated good to excellent compared to 68% last year.   Forecasted corn supply from the upcoming crop year is projected at a historical high with usage also historically high.
Despite this, crop year ending stocks are projected to be the highest in almost 30 years.  The price of corn has declined from a high in the spring of $4.38/bushel to the current price of $3.37/bushel.  Futures prices are showing prices strengthening somewhat throughout the upcoming crop year, rising to the $3.62/bushel in July 2017.
Soybean harvest has also just begun, with only 4% of the harvest completed.  Like corn, the condition of the soybean crop is better than last year with 73% of the crop rated good to excellent, this is compared to 63% last year.  A record production is forecast for the soybean crop.  However, demand is also high with increased bean exports and crush for soybean meal and soybean oil.  Soybean pricing has dropped as the current crop season has progressed.  The price has dropped from a high in the spring of $11.78/bushel to the current price of $9.72/bushel.  Futures soybean prices are rising gradually to $9.90/bushel in July, 2017.
As you may expect, soybean meal and soybean oil prices are influenced by bean prices, but price is also driven by other supply and demand fundamentals.  This can have an effect on prices that trend differently that bean pricing.  Soybean meal prices have steadily dropped as the soybean prices have dropped.  Meal has dropped from $418/ton to the current price of $312/ton.  Futures prices currently show meal to remain relatively flat.  Soybean oil prices have shown a lot of volatility with prices moving in both directions.  Oil prices had been dropping until late July and then took a steep rise in price, and have since begun to drop again.  The Chicago Mercantile Exchange price of unrefined soybean oil has ranged from $.29/lb to $.35/lb this calendar year. Its current price is $.3283, and futures show the price gradually increasing to the high $.33s/lb this crop year.
Cane sugar and beet sugar have evolved to become two distinct markets due to non-GMO demand.  Cane sugar historically had a $.02 premium to beet, but this has grown to a $.04-$.05 premium with tight cane supply relative to the high demand for non-GMO sugar.  The suspension agreement with Mexico continues to be a major driver of pricing which allows the USDA to adjust the allowed sugar imports from Mexico every few months to reset to a 13.5% Stocks-To-Use ratio.   However, this agreement is in the process of be renegotiated. Although there are adequate overall US sugar stocks, cane could potentially be short of covering non-GMO cane demand.  Until this is resolved, the market will remain tight on cane and the premium will most likely persist.