Coronavirus has pulled the rug out from under demand for pork belly and ribs, driving hog prices to their lowest level in nearly two decades.
Amid simmering concerns the nation's meatpacking capacity could tighten as workers get sick and plants close, hog farmers now also face major losses on every pig they raise and sell.
About two-thirds of pork belly, from which bacon is derived, is purchased by the food-service industry, and the shutdown of restaurants, colleges and schools has hit hard.
"Demand for the belly really dropped," said Lori Stevermer, a hog farmer near Easton, Minn. "That type of pressure just continues to bring prices down."
Since March 25, the price per pound for lean hog has dropped about 20 cents. A typical hog yields about 210 pounds of lean meat, so that's a drop of $42 per animal, reflecting the lowest hog futures since 2002.
"Taking feed costs into account, it's projected we'd lose about $25 per head the next year," said Dave Preisler, director of the Minnesota Pork Producers Association.
It's not just bacon causing the decline. Closed restaurants aren't purchasing pork chops or ribs either.
Packing plants are putting more meat in storage, but they're also trying to send more bacon and other types of meat to the grocery store, where demand has been strong.
"You're trying to pivot," Stevermer said. "Instead of going to food service and restaurants, can you take that into the grocery stores? That would involve cutting the carcass a different way, and packaging it differently."
Food service companies buy bacon by the 15- or 20-pound box. Shifting the supply chain to wrap that bacon in a 12-ounce package for the grocery store takes time.