Pork-belly futures surged to a record $1.185 a pound after a plunge in U.S. inventories of the meat, which is used to make bacon. Hogs dropped the most in a year, and cattle gained.
In the past year, pork-belly inventories monitored by the Chicago Mercantile Exchange have tumbled 73 percent after losses in 2008 and 2009 spurred farmers to cut breeding herds close to the lowest amount on record. In the same period, the wholesale price has surged 76 percent, reaching $1.4308 a pound on Aug. 3, the highest level since at least 1998, government data show.
“There are just no stocks now, no frozen bellies around,” and U.S. supplies can’t meet consumer demand for bacon, said Tom Cawthorne, the director of hog marketing at R.J. O’Brien & Associates in Chicago.
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