Bellies rally nearly $20/cwt. during first three weeks of January.

Krissa Welshans, Livestock Editor

January 23, 2019

2 Min Read
Is McDonald’s first-ever Bacon Hour behind belly rally?
McDonald's

In celebration of bacon’s limited-time arrival to the McDonald’s Classics – the Big Mac Bacon burger, Quarter Pounder Bacon burger and Cheesy Bacon Fries – McDonald’s is makin’ bacon dreams come true by giving fans even more bacon.

On Jan. 29, from 4 to 5 p.m. local time, McDonald’s is hosting a first-of-its-kind, nationwide bacon bash called Bacon Hour. For 60 minutes, customers will be able to get thick-cut, Applewood smoked bacon with anything on the menu, at no additional cost.

According to the restaurant, customers will be given two half-pieces of bacon on the side with any purchase and can add it to whatever item they wish.

“When we said there’s no such thing as too much bacon, we weren’t kidding. Jan. 29, we’ll be upping the bacon ante ... and celebrating this glorious food favorite like never before,” said chef Michael Haracz, McDonald’s manager of culinary innovation. “I love bacon. America loves bacon. I really can’t wait to see the crazy and daring combinations our customers put together.”

Bellies post gain ahead of promotion

All signs point to McDonald’s giant promotion as being the leading cause for a recent run-up in belly prices, Adam Speck, commodity market analyst for Informa Economics IEG, told Feedstuffs.

“It makes sense, and it jives correctly. There’s no other fundamental thing driving the market right now,” he said.

U.S. Department of Agriculture data show that bellies closed at $126.86/cwt. on Dec. 31, 2018, but had risen nearly $20 by Jan. 14 to $144.62/cwt. They have since fallen, closing Jan. 22 at $123.05/cwt.

Speck said during the first three weeks of January, the U.S. harvested 6% more hogs than the same period last year. According to USDA, however, only 3.5% more hogs were available, he explained.

“It’s my personal opinion that the strong rise in belly prices during a time of overproduction of pork in general implies we were harvesting for the belly during that time frame,” he said.

Speck explained that belly stocks are typically depleted sometime in late fall and are held to very low levels from November to December. They begin to ramp up in December, and then cold storage begins to go into rotation from there into March and April to prepare for the summer months, he said.

“Some of that is going on right now. If this is on top of that, then we were harvesting for the belly just for McDonald’s,” Speck said.

While bellies saw a short-term rally, the price support failed to help other products in the cutout. In fact, loins and butts have been really cheap.

“If you’re harvesting a 6% increase in animals and you only need the belly, you have to discount the other product in order to move it,” Speck said. “You have that many more hams, that many more loins, that many more butts -- and you’ve got to discount those.”

About the Author(s)

Krissa Welshans

Livestock Editor

Krissa Welshans grew up on a crop farm and cow-calf operation in Marlette, Michigan. Welshans earned a bachelor’s degree in animal science from Michigan State University and master’s degree in public policy from New England College. She and her husband Brock run a show cattle operation in Henrietta, Texas, where they reside with their son, Wynn.

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