By Kirk Maltais, Wall Street Journal

Bacon prices could soon start heating up.

Wholesale prices for pork belly–the cut of meat used to make bacon–have surged this summer, nearly tripling since the start of June after hitting a multiyear low in May. Pork-belly prices were at $2.15 a pound on Wednesday, just shy of their highest level since last August. The run-up could soon pressure restaurants and supermarkets that had been stepping up bacon promotions.

“They’re probably thinking twice about featuring a new bacon cheeseburger, bacon chicken sandwich or Baconator, or whatever,” said Brian Earnest, lead economist for animal protein with agricultural lender CoBank.

Helping drive the price surge is an animal-welfare law in California requiring pigs to be given at least 24 square feet of pen space for their meat to be sold in the state, which accounts for roughly 15% of U.S. pork consumption. After facing years of legal challenges, Proposition 12 was upheld by the U.S. Supreme Court in May and went into effect July 1.

Pork producers initially held off on buying new products after the Supreme Court ruling because they were unsure about how the law would be implemented. “You had processors that didn’t want to buy products for their freezers if it wasn’t Prop 12 compliant,” said Adam Samuelson, an agribusiness analyst with Goldman Sachs.

Then in June, California struck a deal with pork producers allowing them to sell their pre-existing inventory for the remainder of the year. Prices subsequently charged higher as buyers rushed to load up on supplies before the law came into full effect.

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