Will there still be bacon in California?

This July, California got the final greenlight for Proposition 12, which establishes a minimum space requirement for breeding pigs, calves raised for veal, and egg-laying hens starting January 1, 2022. It also bans the sale of goods from producers who do not meet these requirements.

This measure — also known as the Farm Animal Confinement Initiative — was met by strong opposition from the American Farm Bureau Federation (AFBF) and the National Pork Producers Council (NPPC), which claimed the necessary renovations to their facilities to meet these regulations would be prohibitively expensive, among other complaints.

Here’s where things get a bit tricky: while California consumes 15% off the nation’s pork products, most of their inventory comes from other states. So, there is concern that these producers will abandon the market rather than paying to comply with the new guidelines — which would lead to shortages of pork products in the state, and subsequent price hikes on what is available.

This possibility has breakfast lovers fearing the worst — some are even predicting that bacon may disappear from California altogether. But this concern is likely overblown.

The EU, known for animal welfare requirements at least as stringent as the new California laws, is the world’s second largest producer and biggest exporter of pork. And, the EU Commission is so dedicated to these standards — and seemingly so unphased by any potential marketplace ramifications — that it is working to end caged farming by 2027.

With this in mind, the implementation of measures like the Farm Animal Confinement Initiative could help open new markets for US meat producers, rather than taking them away. For example, the EU’s food safety rules mean that they only import pork from a limited number of non-member countries. As of 2013, only five US slaughterhouses made the cut. These new regulations could potentially open the door for more to join the list.

Perhaps the pork panic is premature. But, after California, could Oregon or New York follow? In any event, it’s a safe bet that this will not be the last we see of this type of legislation. So, it may be time for us to play catch up and prepare for the new marketplace reality.

Danilo Diazgranados is an investor, collector, and lover of fine wines and a member of the prestigious Confrérie des Chevaliers du Tastevin, a fraternity of Burgundy wine enthusiasts.