Yesterday, the USDA reported that the average farm price for corn in the 2012/2013 season is projected to rise sharply from $4.20-$5.00 a bushel to $5.40-$6.40 due to the extreme heat and drought across corn country that has been wreaking havoc on crop production. For Americans, it means we can expect to see higher food prices coming to a store near you. Higher prices won't just be on ears of corn, but on all other products that depend on corn. The price of meat, milk, cereal, candy, and other food will all be impacted.
Meanwhile, in the Sahel region of West Africa, as many as 17 million people are now at risk in a food crisis that stems from crop failure, drought and high food prices. In The Gambia alone, skyrocketing food prices mean an estimated 700,000 people are going hungry. The U.S. is the largest exporter of corn in the world, but the latest USDA estimates are that we will be exporting 300 million fewer bushels due to tight supply and higher prices.
What is the hidden ingredient in rising corn prices?