Relax, the Great Bacon Shortage of 2012 Is a Myth
High feed prices mean more pork, not less.
On the other hand, those "moving parts" Hackett mentioned make the livestock market notoriously difficult to predict.
"If feed prices fall quickly, farmers may go back and start increasing their herd sizes again," he says. "And you can do it pretty quickly with hogs -- it's a six-month cycle, unlike cattle, which is a two year cycle."
Of course, hog farmers will also have to contend with the USDA's estimate that overall meat production will be roughly 12% less in 2012 than it was in 2007, signaling a structural shift in the way people eat -- as well as something for large retailers like Safeway (NYSE:SWY), Kroger (NYSE:KR), and Whole Foods (NASDAQ:WFM) to consider very seriously.
All-in-all, bacon-eaters can relax. Here's Hackett again:
"To say that a bacon shortage could reach a dire level, there's just no way you could make that conclusion, not at all."
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.