From Weather.com
July 19, 2012
Record setting temperatures and little rain have put much of the Corn Belt under a severe drought. The extent of drought nationwide is at its highest levels in this century, according to the U.S. Drought Monitor report.
"The drought is going to have a direct impact on all our wallets," said Paul Walsh, vice president of Weather Analytics for The Weather Channel.
Walsh said the drought has impacted one of America's biggest cash crops: corn. This year's record heat has created a bad growing conditions.
Corn is hugely impacted by weather. The beginning of the year was perfect for crops, but now the corn is in the middle of pollination. That's when the big risk comes in, Walsh said. Extreme heat and drought can decrease the number of kernels on the corn stalk.
Fewer kernels lead to a lighter crop, forcing prices to rise. Since mid June, corn prices have been on the rise. Just this week they shot up 5 percent.
Corn is directly tied to the U.S. economy because it is found in thousands of products. In the following pages we look what items you'll be paying more for by the end of the year.
The price of milk is directly related to corn prices. Corn is a part of a dairy cow's diet. If farmers are paying more to feed their cows, consumers will have to pay more for milk.
Beef prices are directly related to corn prices too. Corn is what farmers use to feed beef cattle. Higher prices for feed will directly impact the price of your favorite cut of meat.
Corn syrup is in thousands of items like candy, soda and ketchup. The next time you shop for groceries, take a look at the ingredient list. If you see corn syrup as a main ingredient, expect prices to go up.
Corn is the main feedstock used for producing ethanol fuels in the U.S. Corn ethanol is mainly used as a compound to produce low-level blends of gasoline. This is likely to help drive up the cost of fuel.
Expect to see cost increases at the grocery store by the end of 2012 and into 2013. Analysts say there is a small chance conditions for this year's corn crop could improve. Growers say damage continues everyday the temperatures are 95 degrees or higher.
Posted By: Siebra Muhammad
Saturday, July 21st 2012 at 5:07PM
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