Prices are now 25pc-42pc higher than at this time last year, with the biggest price increase coming in baconers.

Pork, bacon and sow prices usually increase in the lead up to Christmas, at both the retail and wholesale levels.

However, this year’s rapid increase in prices is due primarily to supply influences, with the decline in the number of pig farmers and subsequent reduction in pig breeder numbers.

Rising production costs, along with increased competition from imported product, mainly from North America and Denmark, have largely driven this decline in Australian pig numbers.

Slaughter levels for this financial year to date totalled 71,407 pigs, which is 17pc below that the same period last year.

This week’s national over-the-hooks pork price averaged 363¢/kg, while the bacon indicator averaged 344¢/kg cwt.

Both these prices are the highest in the past few

years.

Over the past month, the bacon price has drawn closer to the pork price than at any other time over the past few years, due to processors attempting to prompt producers to grow pigs out to heavier weights, in order to meet wholesale demand.

The difference in price between the two categories is now only 5pc, whereas over the last two years, pork prices have been at a 12pc premium to bacon prices.

At the wholesale level, both DF pork (45-60kg cwt) and GI bacon (60-75kg cwt) rates have been on the rise.

DF pork moved from 430¢ at the beginning of the financial year, to

540¢/kg cwt this week (prices were 400¢ this time last year). Similarly, GI bacon increased from 390¢ at the start of June to now average 510¢/kg cwt (compared to 360¢/ kg this time last year).

Retail demand, as a result of higher prices, has softened somewhat, although it's likely to improve as Christmas approaches.