With the worst drought this summer since 1956, prices of corn-feed have soared to record highs. Many animal farmers are losing money, and pig farmers have begun to cull their herds, slaughtering cows to stay profitable and driving us towards an inevitable bacon shortage.
The shortage on pig-made products is quickly becoming global, and the United Kingdom’s National Pig Association said that a “world shortage of pork and bacon next years is now unavoidable.” The European Union pig herd is rapidly declining, affected by droughts in North America and Russia that have caused grain prices to skyrocket. The droughts got so bad in the United States that nearly half of all counties were considered disaster areas due to extreme dryness and heat.
While prices for pork products may be low now, by 2013 they will rebound and start to increase with the shortage. These rising costs will definitely be experienced in restaurants and grocery stores, as consumers could pay 3.5% more for pork products in 2013. This means many chain restaurants and brands could begin substituting pork products for other meats, or using pork substitutes like turkey bacon. Cracker Barrel Old Country Store, which operates over 600 restaurants across 42 states will probably pay close to 5 to 6 percent more for its food commodities. The chain is responding by raising menus prices about 2% in 2013.
Bob Evans Farms Inc., an Ohio based restaurant chain has taken note of recent price drops in pork. CFO Paul DeSantis said he expects prices to remain low while large numbers of pigs are slaughtered, after which prices should increase very rapidly. With prices so low, now is the best time to buy bacon, ham and other pork products.
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