The price of bacon is going up and when it's going to come back down is anyone’s guess. During the past year bacon, has seen a 211 percent price increase.
The spike in price has been caused by several things.
First, the recession took its toll. Like most industries, the bacon market took a big hit when the economy took a big dive. Simple economics dictate that if supply is less than demand, then price goes up.
Another issue is the unfortunately named swine flu, or H1N1. The bug caused a huge dip in pig production because consumers and producers believed that pigs transmitted the virus to humans.
With the losses over the last few years, pork producers are wary of increasing herd size. They are now making money and would like to stay that way, so they will keep the supply of pork—and thus bacon—lower. This year’s production is predicted to be down 3 percent from last year. Considering that bacon is a multi-billion dollar industry, 3 percent is a heck of a lot of bacon.
The transfer of cost has yet to be felt much by the end consumer, but I bet it's coming.
Production is down and demand is high? Sounds like the perfect recipe for the highest bacon prices of all time.
Randy King will continue to eat baocn, not matter what the cost. Click to follow Randy on Facebook.