Articles/Columns
U.S. Suffers from Severe Drought: Food Prices Expected to Rise
Most of continental United States is suffering from a drought this summer. As reported by the New York Times, 2012 has so far been “the hottest year ever recorded in the U.S., according to the National Oceanic and Atmospheric Administration,” whose records go back to 1895. The federal government has already declared nearly 1,300 counties across 29 states to be federal disaster areas, which mean farmers in these disaster areas will have access to low interest rate loans to help them survive the severe weather conditions. Corn and soybean production, as well as other crops, have taken a big hit, and the drought is expected to extend into August and continue spreading. As the NYT reports, this record-breaking weather is expected to increase the price of foods in the near future, especially since staples such as corn and soybeans are also ingredients in many other food products, including animal feeds. In the near term, some analysts do not expect too much of an impact on consumption patterns among American consumers since the price of gasoline has been falling. Americans generally spend around 13 percent of their household budgets on food, so the impact is expected to be minimal for now. The NYT reports that the greater impact will be with the price of food exports, since supplies will decrease. For example, the U.S. government cut its outlook to 146 bushels* of corn per acre in July, down from 166 just from last month. Therefore, the price of wheat, corn, and beans are expected to rise in the near future for overseas food and animal feed producers.
* 1 U.S. bushel = ～35 liters
Damaged Corn Harvest
Source: New York Times
Historic Drought Patterns in the U.S.
http://www.nytimes.com/interactive/2012/07/20/us/drought-footprint.html?ref=business
Source: New York Times
（2012/7/27 掲載）