Hog futures are sitting at the highest price in almost three weeks as U.S. bacon supplies fall short of consumer demand, according to Bloomberg Businessweek.
Wholesale pork bellies hit their highest price since January 1998, jumping 7.9% on Wednesday to $1.332 a pound, while stockpiles monitored by the Chicago Mercantile Exchange fell 70 percent from 2009. "The bacon market will probably lead pork products higher in the next several weeks," said Paul Beere, a market advisor at Prime Agricultural Services in Brookfield, Wis. Low supplies, he said, are due mostly to herd liquidation and a rebound in demand.
Hog futures have jumped 47% in the last year as demand recovered from the recession and the H1N1 virus while supplies declined. U.S. bacon retail prices climbed to $4.046 a pound in June, the highest level seen since at least 1980, according to the Bureau of Labor Statistics.