Bacon is not available in the United States

Bacon is in demand in the United States. Consumers are consuming frantically, causing frozen inventories to fall to their lowest level in 60 years. The price of pork bellies has already risen by 80% this year.

In the past, bacon was one of the cheaper parts of the pig, but that has changed rapidly. The fatty image of bacon has turned into a popular dish for breakfast, for example. Americans bought about 2016% more bacon in 14 than in 2013. It gives the price of pork bellies a huge boost. In mid-July, the price of pork bellies was $2,55 per kilo. This means that the price is 50% above the long-term average.

Stock never before so low
In the past, bacon was mainly consumed during the BBQ season. Slaughterhouses absorbed this peak demand by freezing a lot of pork bellies in the winter. Last winter, however, demand remained strong, so stocks are now running low. Although America this year a record of pig counts, there is a shortage of bacon. In May, the USDA, the United States Department of Agriculture, recorded a bacon stock of just 15.800 tons. That is a decrease of 60% compared to a year earlier. Stocks have never been this low.

It is difficult to say whether the price increase will continue, according to the American analysts. Higher retail prices may dampen demand for bacon. In addition, the USDA is expected to have an even larger pig stock in the fall, increasing bacon supply. 

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.