Bacon lovers beware: Next year it will be harder and more expensive to satisfy your craving. According to Britain's National Pig Association, a world shortage of pork next year is now “unavoidable.”
The decline is credited to rising pig-feed costs due to the short supply of corn and soy this year, as many harvests failed from extreme temperatures and drought.
All this doesn't bode well for the U.S. supply of pork and bacon. A coalition of beef, pork, chicken and diary producers is asking the government to wave or suspend the U.S. Renewable Fuel Standard, which requires billions of gallons of corn-based ethanol to be blended with motor fuel, to help free up corn supplies.
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The impact of the shortage is already being felt. “Over the next 30-90 days, restaurant owners could be faced with upward of 15 percent increases in most of their food items, and some price hikes may be even higher,” says John Davie, president and CEO of Consolidated Concepts, a group buying and services company for restaurant chains.
“We've seen the price of bacon alone shoot up 20 percent from May to August,” Davie says. And that's before the full negative impacts of the drought (which caused hog growth to be hindered by the heat and more unplanned deaths) have been felt. “When you consider that most restaurants have only a 5 percent profit margin, a 15 percent increase in food prices could be disastrous,” he says.
Davie’s colleague, Bruce Reinstein, vice president of strategic development and sourcing for Consolidated Concepts, worries some pig farmers will abandon their operations altogether, further impacting supplies.
How high might prices go? Perhaps up to 20 percent, says Reinstein.
But there's more fallout. According to the managing director of Atlantic Financial, Bruce Fenton, whose specialties include agriculture, “Prices are certain to increase for not only for pork, but beef and beef bacon, hamburger, steak and other beef products – probably to the point of changing eating habits for many people,” he says.
