Grocery prices will increase due to drought
Drought has devastated many farmers' crops
MADISON, Wis. — The weather has been slightly better for farmers, but it may not have come soon enough to prevent a spike in food prices.
“If I’m shopping, and I’m just picking up groceries for the family, I’ll check around and see what produce is in season and what’s on sale,” said shopper Liz Mohler. “And then I’ll create a menu around that.”
As the push-pull mechanisms of supply and demand draw carts to and away from a variety of products, shoppers said they are concerned with how a dismal growing season will affect prices at the grocery store.
“With the corn and what’s going on, it does make me a little nervous about enjoying it now while it’s here,” said Mohler. “Because there’s not much of it, and maybe there’s going to be an impact on items in the future.”
Bruce Jones, a professor of ag economics at the University of Wisconsin-Madison, said new numbers show the U.S. corn supply could be heading to a 17-year low, and corn prices exceeding $8 a bushel are now setting up a trying year ahead for farmers and shoppers.
“That’s the highest we’ve ever seen,” said Jones. “I mean, $8 corn is $3 higher than we’ve seen a year ago at this time. In the span of six weeks, we went from $5 corn to $8 corn. We could still go higher.”
And those prices are affecting shelves all over the grocery store. Jones said meat prices will drop due to the abundance of supply at first.
“Then we’re going to start seeing those shortages because people aren’t going to be producing those products,” said Jones. “And we’re probably going to see that happen late this year and throughout 2013.”
Experts said shoppers should expect a 3 percent to 5 percent increase in the grocery bill for 2013.