It’s been a heck of a summer. While I’ve enjoyed the sun, beach, bike rides and cooling watermelon-mint-feta salads, I am pretty ready for the fall. I know this is crazy talk, especially living in the northeast where the winter is long and mean, but honestly I don’t think I can take more of this heat. I feel like I’ve been sweating for two months straight! My summer wardrobe consists of the same 3 dresses from Target because they are breezy and cool, and I’m on a first-name basis with my air conditioner (I call him Boris the Russian).
The summer has been especially rough for farmers in the US Midwest, and their troubles go far beyond the rage I feel when I get a breath of sun-scorched, urine-soaked sidewalk, or when I feel the drizzle of leaking air conditioners from above.
This summer, the midwest has been experiencing the worst drought in at least 50 years. The lack of rain and high temperatures have destroyed acres of farmland and crops, and have caused farmers to abandon sun-scorched crops and land, and sent them scurrying for alternative sources of feed.
Why should we care? The summer drought affects us as consumers in various ways. The major crops affected are corn, soybean, wheat, and sugar among others. The threat to corn crops is especially alarming as corn is used both as food and fuel. The corn crops are not the same as the sweet corn that we eat, but are more used to feed livestock. Corn is also mixed with ethanol to create “green” clean energy alternatives.
As a result, analysts are predicting that food prices will go up in the next year. Since corn, wheat, soybeans, sugar and other crops are traded as commodities, the shortage of crops and continued threat is reflected in commodity prices, demand is up and this will certainly continue to affect the market and the global economy. The shortage will also affect food manufacturers that rely on these crops for their products. Keep in mind that food shortages result in higher food costs not just in the country where the shortage exists but also to its trading partners globally. The 2007-2008 food shortage in the US and Europe caused upheaval and even riots in over 30 countries around the globe.
Since manufacturers have established that they will pass the higher feed prices onto consumers, expect to see the cost of food increase by the fall. Here are some ways the drought is expected to affect consumers:
– As meat and poultry supplies decline, the US Department of Agriculture is predicting that meat prices–in beef, chicken, pork and other livestock–will increase in the next few months and continue into 2013.
– The price of milk and dairy products is also expected to increase by fall.
– Expect to see price increases in processed and packaged foods in about 10-12 months.
– We should not see a significant increase in cost of wheat products as wheat crops in the midwest are normally harvested in spring and so avoided the summer drought, and the crops in the Northern Plains have so far not been affected by the drought.
If you want more insight into this, check out the US Department of Agriculture website on this topic. http://www.ers.usda.gov/newsroom/us-drought-2012-farm-and-food-impacts.aspx