Drought to Have Minimal Effect on Food Prices
Will the summer’s drought affect the price of your groceries? Only at a very minimal rate compared to previous years.
According to Illinois Farm BureauSenior Economist Mike Doherty, food prices rarely remain static, as they’re affected by many different factors, such as inventory adjustment, export demand and energy prices. This means a relatively minor drought impact, with food prices expected to rise 3 to 4 percent in 2013, compared to a 2.5 to 3.5 percent increase in 2012.
Economists forecast beef prices will increase the most due to higher prices of feed, but only by 1 percent more than last year. Higher feed prices have led to some farmers liquidating their herds, which eventually will reduce the beef supply. For other products whose ingredients include corn or soybean meal or oil, such as frozen dinners, the impact will be negligible, Doherty says.
For more information on the 2012 drought, visit www.ilfb.org/drought.