- Hogs are in short supply ahead of this summer’s pent-up demand for products like bacon and hot dogs.
- That means hog-meat prices might be higher, and consumers will see fewer discounts.
- “The whole supply chain has really been squeezed,” said ArrowStream’s Isaac Olvera.
- See more stories on Insider’s business page.
Summer barbecues may taste a little different this year.
Hogs have been in short supply since the beginning of the COVID-19 pandemic more than a year ago. Now analysts are predicting higher prices and a short supply of pork for foods like hot dogs and bacon as restaurants re-open and summer barbecues resume as vaccinations in the US pick up pace.
The problems are “after-effects of last-year’s disruption,” said Christine McCracken, Rabobank executive director for animal protein.
“This goes all the way back to the start of COVID,” said Isaac Olvera, food and agriculture economist at ArrowStream.
Most Americans will have been able to get the COVID-19 vaccine by July Fourth. But “many consumers still feel more comfortable with outside dining and gatherings, so I suspect grilling out is going to be a very popular activity this summer,” said Anne-Marie Roerink, principal and founder of 210analytics.
With that, McCracken said there’s likely pent-up demand for meat. “BBQs and family gatherings are going to be a nice way of reconnecting and will be a big driver of meat demand in the coming months,” she said.
“The whole supply chain has really been squeezed, and unfortunately it does not look like this is going to be something that improves between here and early summer,” Olvera said.
The numer of market hogs, piglets, and future piglets, dropped 1.8%, 1.4% and 2.5%, respectively, from March 1 2020 to March 1, 2021, according to Olvera.
The decline means retailers are likely to “price-ration supply” of hog meat, he said, so consumers will see higher prices and fewer discounts to keep stores from running out of stock.
“Bargains on meat might be tough for consumers to find this summer,” McCracken said. “So my advice to consumers would be to stock up when you find a good deal.”
But consumers generally shift their preferences, and retailers change up their promotional strategies, accordingly, said Roerink.
“While prices may be a bit higher, consumers are typically very creative in making adjustments in other areas to host family and friends,” Roerink said.