National Pig Association Warns on Bacon Supplies

A world shortage of pork and bacon next year is now unavoidable, says Britain's National Pig Association. Of course, if you have a free market, you don't have shortages. If supplies shrink, prices climb.

According to NPA, new data shows the European Union pig herd is declining at a significant rate, and this is a trend that is being mirrored around the world. Pig farmers have been plunged into loss by high pig-feed costs as a result of the near global drought.

All main European pig-producing countries report shrinking sow herds. Falling numbers in the 12 months to June 2012 have been reported by Denmark (-2.3), Germany (-1.3), Ireland (-6.6), Spain (-2.8), France (-3.2), Italy (-13), Hungary (-5), the Netherlands (-3.6), Austria (-2.8), Poland (-9.6) and Sweden (-7.2).

It's the same in the U.S.


British Pig Executive Mick Sloyan warned a private meeting of British and mainland Europe retailers at a Brussels summit yesterday that a fall of only 2 percent in slaughterings next year will cause prices to rise by 10 percent.

NPA believes slaughterings could fall by as much as 10 percent in the second half of next year, which indicates a doubling of the price of European pork and pork products.

In the U.S., “We’re waiting for any day for prices to start spiking up,” said Ken Agojcki, who owns Chicago Prime Meat Market in Glen Ellyn, Illinois. “We haven’t see it yet, but the fear is out there that this is going to happen.”

If Bernanke's QE3 kicks in, we could have a perfect storm of climbing prices next year, less supply and more dollars chasing that supply.