Bringing Home the Bacon Is 28% More Expensive — Unrelenting Inflation Lifts Prices to a 40-Year High
Overall inflation is around 5% higher now than it was a year ago, but a certain sector has been unevenly tipping the scales upwards — meat.
Meat prices have significantly contributed to the overall increase in inflation this year, according to Consumer Price Index data. Prices for ground beef are up a whopping 12%, with pork and chicken up 7% and 5%, respectively. What’s more, the prices for bacon are up an astounding 28% in the past 12 months.
The classic supply-demand issues that plagued international supply chains throughout 2021 were felt quite more intensely in the meat industry, which was hit particularly hard by the pandemic as they were deemed essential workers and could not shut down. Additionally, the meat industry in the United States is a very “consolidated” market, meaning that very few control the majority of the supply and distribution.
More than 80% of beef in the U.S. is sold by just four companies. With pork, it’s 66%. “Big Meat,” as it is sometimes referred to, was slow to instill protective measures against COVID-19 and became a hotspot for infections. Some plants shut down entirely or had to temporarily shut down. Adding to the strain, meatpacking plants were hit by cybersecurity attacks as recently as June, halting U.S. meat production for entire days at a time. A ransomware attack in one of the big four meat plants, JBS, put over a quarter of the nation’s beef supply on hold for almost a week.
With plants shut down and distribution overall disrupted, a backlog of animals began to grow, which resulted in millions of pigs being euthanized without processing into food. Producers wary of getting ahead of demand with too much supply also started reducing the size of their breeding herds, ultimately depressing this year’s pork supply, reports CNN. Pork production overall is expected to close out this year 2% lower than 2020 levels.
This, coupled with rising demand that came with more people cooking at home, drove prices up — and they are likely to stay that way for the coming months.
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Supply chain barriers, like the rising cost of freight, feed and labor, will likely all keep pork prices elevated until the full effects of the pandemic start to ease down the chain.
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Last updated: October 4, 2021