In the 1950s, 60s and 70s, pork bellies were one of the highest traded commodities available. This past November, just six contracts changed hands in the entire month. The pork-belly pit that had once been the center of attention, has since been moved to a corner of the CME's floor, and is now just an appendage to the lean-hog-trading pit.
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But what does that mean for the average bacon lover?
It won't mean the end of bacon, as we suggested in our salacious lede. However, consumers will likely see more extreme fluctuations in the price of bacon.
This year, spot prices on bacon soared to $1.60 per pound in September before dropping to 88 cents by late October. By November, retail bacon cost almost $4.70 per pound, up 34% from the previous year. That makes bacon more expensive than pork chops.
The irony of this economic shift is that it occurred because bacon has grown so much in popularity that it is now an everyday food. Producers no longer needed to store vast quantities of bacon during the winter months. As a result, futures trading in pork bellies has dipped to precipitously low levels. That, in turn, affects the day-to-day price fluctuations of bacon. Now, go have a BLT.