Or they intentionally want to cause a supply shock, to punish California voters for trying to improve animal welfare, and to deter other states from doing the same.
Or the cost of the changes are not compatible with their business model and it’s more profitable to not make changes and export what would have gone to california.
Could be. I think the pork industry probably believes this is a temporary anomaly that they can overcome with lobbyists and lawyers. Or that California voters will reverse themselves once bacon costs $10 a pound. If that's true, they wouldn't want to invest for that short time horizon.
If a similar rule were adopted nationwide, I'm sure they could make changes and pass the price increases along to the consumer.