Prices for pepperoni and cheese are rising due to increased demand and supply chain problems.

By Jelisa Castrodale
August 19, 2020
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Check your "What Are We Running Short Of Today" bingo card, because if you have a "sliced pepperoni" square, then you could be a winner. That's right, apparently some pizza shops are dealing with dwindling supplies of pepperoni due to a combination of factors, ranging from increased demand for pizza to pandemic-related production issues. 

According to Bloomberg, some smaller, mom-and-pop pizza joints have reported that they're seeing higher prices for pepperoni, and it's becoming increasingly difficult to come by. One South Dakota pizza shop manager reported that the cost of the pizza topping has increased from $2.87-per-pound in January 2019 to $4.12-per-pound now –– and that still sounds like a bargain compared to the $6 bucks-per-pound that some New York City restaurants are currently paying.

"The price has gone up,” David Valian, the owner of Big Mama’s and Papa’s Pizza, told CBS Los Angeles. “A couple of weeks ago, we were having some trouble sourcing pepperoni,” Valian said. “We always have to go back and try to find more.”

Part of the problem is that sliced pepperoni is a labor-intensive combination of beef and pork –– although there are pork-only and beef-only versions –– and some pork producers just aren't bothering with it right now. Pork processing plants have had to pare down their operations because of pandemic-related personnel issues, and pepperoni's lengthy production time and the thin profit margins make it a less practical use of those already-limited resources. 

"[Pork producers] are basically just shipping out large pieces of meat for further processing,” food industry consultant Barry Friends told Bloomberg. “They’re not doing as much because they don’t have the people to do the work." 

Perhaps unsurprisingly, national chains like Domino's, Papa John's, and Pizza Hut haven't been affected by either the shortages or the price increases: they tend to have long-term contracts with their suppliers, and they've locked in their pepp' prices well in advance. 

Another non-surprise is that demand for pizza has continued to surge during the pandemic. Last month, Domino's reported that its U.S. sales had increased by 16 percent during the second quarter of this year, compared with the modest 3 percent sales increase that it reported during the same time period last year. “The second quarter marked a rather unprecedented acceleration for food delivery in the U.S., and we were certainly no exception,” Domino’s CEO Ritch Allison said

And because there are still four months left in this cursed year (or 136 days, if you're also keeping track) this might not be the last challenge that pizza restaurants face –– not when the price of cheese keeps climbing too. "[The price is] probably higher than I've ever seen it," Pie Life owner Joseph Hogan said. “Cheese is one of those things that always goes up and down, but it’s pretty spendy right now.”

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