Quietly, a food crisis brews
July 20, 2012
The nation is experiencing its worst drought in over half a century. Grain crops, particularly corn, are being devastated as only 31% of the domestic corn crop in is good shape versus 40% just one week ago. The same is true for soybeans as only 34% is in good shape versus 40% last week.
As a result both commodities have hit record highs on the world futures market. For the first time in history corn exceeded $8.00 per bushel to $8.05 (one year ago–$5.50) and soybeans are at a high of $17.12 per bushel ($10.90 a year ago). It is projected by some commodities experts that these price may go up yet another 20-30%. The inflationary impact of these vital grains will be felt very soon in the nation’s grocery stores as virtually all meat and many processed foods are dependent on these commodities. This on top of an economy that is already languishing in recession levels.
However, the government still insists that over 40% of the nation’s corn crop be diverted to ethanol and burned in our cars. When asked, the current Secretary of Agriculture, Tom Vilsack, rejected calls for corn to be diverted from ethanol production to alleviate the expected shortage of grains for human and animal consumption.