Bacon will be available in California after Proposition 12 is implemented but will cost more, according to a new University of California (UC) study. The Prop 12 pork panic is overblown, say UC agricultural economists, but so are the new law’s benefits to hogs.
California’s Prop 12 will soon require farms to add space for certain farm animals, including breeding pigs or mother sows. As the January 2022 date for full implementation of Prop 12 approaches, some pundits warn of upcoming bacon shortages and up to 60 percent higher pork prices, while others downplay any negative effects on Californians.
What are the real impacts of Prop 12, which was approved by California voters in 2018?
UC Davis economists estimate that California pork consumers will lose $320 million per year (roughly $8 per person) from the market impacts of Prop 12. California consumers will pay about 8 percent more for pork regulated under Prop 12 and will consume around 6 percent less of that pork per year.
Coauthor Richard Sexton, UC Davis distinguished professor of agricultural and resource economics, noted, “The roughly 9 percent of North American sows affected will each get about 20 percent more housing space. But, the additional space will be for those sows that already have more space, not those confined in small individual stalls.”
California’s Prop 12 is now set to be implemented as planned following the 9th Circuit Court’s recent rejection of legal challenges. Republican senators from Iowa have proposed federal legislation to stop implementation of Prop 12, fearing economic damage to their hog farmers, but federal action is unlikely. Meanwhile, Prop 12 supporters claim that the new regulations will give more space to sows confined to stalls so small that they can’t turn around.
Prop 12 requires each sow whose piglets are raised for uncooked cuts of pork sold in California—about 9 percent of North American sows—to have a minimum of 24 square feet of space. Because Prop 12 applies only to sows, not to their offspring who are raised for meat, it will apply to well less than 1 percent of the 90 million North American hogs.
Around 30 percent of North American sows are already in group housing with 20 square feet each, rather than confined in stalls. The high cost of converting stalls means that the California pork supply will come from sows already in group housing. “Thus,” said Sexton, “the California Prop 12 regulations will not help those sows confined in stalls to gain more space and mobility.”
The added costs of 20 percent more space for group-housed sows that are transitioned to comply with Prop 12—plus the costs of segregation, product tracing and new labeling—will cause the cost of regulated pork products in California to rise by about 25 cents per pound. The UC Davis research also indicates almost no change in the prices of pork products sold outside of California.
To learn more about the coming impact of Prop 12 on California consumers and the North American pork supply chain, read the full article by Ph.D. candidate Hanbin Lee, Richard J. Sexton and distinguished professor Daniel A. Sumner, all in the UC Davis Department of Agricultural and Resource Economics: “Voter-Approved Proposition to Raise California Pork Prices.” — Ria DeBiase, Giannini Foundation of Agricultural Economics, communications director
