Food Report: One Harvest Away from a Catastrophe

As I was taking my weekly stroll through the grocery isles, I once again saw time and time again the rising cost of foods.  Specially I saw fruits and vegetables on the rise, baked goods, and meats.

Again I am reminded of the fact of how the 2012 drought has impacted American's bottom line.  What is worse is knowing that we have not even felt the full effect of lower crops.

Although some commodities have come down in the last week or two with the rest of the market, we do not expect food prices to come down at all.

This article at Financial Sense gives a good overview of how meek the agriculture situation looks.

• Because of the worst drought since 1988 the U.S. Department of Agriculture declared a federal disaster area in almost one-third of all the counties in the United States - more than 1,300 counties covering 29 states, the largest disaster declaration ever made by the USDA. Only in the 1930s and 1950s has a drought covered more land.

• The United States Drought Monitor shows 88 percent of corn, and 87 percent of soybean crops are in drought-stricken regions.
• Corn, the biggest ingredient in livestock feed, is a mega-crop, there are more than 4,200 different uses for corn products;
• adhesives, aluminum, aspirin, clothing starch, cosmetics, cough syrup, dry cell batteries, envelopes, fiberglass insulation, gelatin capsules, ink, insecticides, paint, penicillin, powders, rugs and carpets, stamps, sweetener’s, talcum, toothpaste, wallpaper, vitamins, processed and fast foods and of course as fuel - ethanol.