Bringing home the bacon is getting a little easier.
Prices of pork products are falling as herds bounce back from a diarrhea-inducing virus epidemic that has killed millions of piglets over the last year, according to data from the U.S. Department of Agriculture.
Hog futures -- contracts that obligate the buyer to purchase pigs at a certain price in the next month -- peaked last March at $1.1167 a pound. Now, next month’s futures are priced at about 69 cents per pound, according to the trade group Chicago Mercantile Exchange.
“Pork prices are getting cheaper,” Terry Roggensack, who co-founded the commodities research firm the Hightower Report, told The Huffington Post on Tuesday. “It’s a positive.”
This chart, courtesy of Index Mundi, shows pork prices declining since October.
The number of deaths linked to the Porcine epidemic diarrhea virus, or PEDv, isn’t the only thing making things less expensive, Roggensack said.
The strength of the U.S. dollar and tumult in Russia sent exports tumbling to about 18 percent from a peak of 26 percent earlier last year, according to Roggensack's data. But the number of hogs being slaughtered rose to 2.316 million last week, a 4.6 percent gain from the same period last year. Unlike other commodities, such as gold, copper or crude oil, only a fraction of pork is frozen and stored for later use.
“For the most part, you’ve got to use it within a month or so of when it’s produced,” Roggensack said. “The domestic market needs to absorb an even bigger supply than it normally would.”
And how do you entice people to buy more of something? Make it cheaper.