Title: Why Are Food Prices Rising - Understanding the Effect of Droughts
Headings: Why Are Food Prices Rising – Understanding the Effect of Droughts
Why Are Food Prices Rising – Understanding the Effect of Droughts
The Economic Impact of Droughts
How Droughts Affect Food Prices
Corn and Grain Dependence
Other Factors That Contribute to Rising Food Prices
Bio-Energy
Global Economic Growth and Food Prices
What Higher Food Prices Will Mean
Final Word

Content: Part of this push for bio-fuel came from agricultural lobbyists, who were hoping to increase the market for corn. What it means is that 40% of the U.S. corn crop now goes to ethanol production, rather than to food production. This is part of the reason you have already seen a steady increase in food prices prior to this year’s drought. Corn is used in everything from cereals, to sodas, to cooking oils, to bread, to yogurt, to salad dressings, and much more – not to mention its important role in feeding livestock. With a major share of the U.S. corn crop being promised to the bio-fuel industry, there is less available for our foodstuffs. Unfortunately, this also means that in the wake of a drought, prices will rise much more than if there were no such ethanol mandate. Specifically for corn and grain products, prices will rise and remain high until the next normal corn crop is harvested in late summer and fall of 2013. Until then, you can expect to see higher prices for cereals, baked goods, cooking oils, and anything sweetened with high fructose corn syrup. Global Economic Growth and Food Prices
Professor Hurt further explained that the past five years have also seen some incredible economic growth in developing countries, specifically in China. This type of economic growth tends to have a transitional effect on the diet of that country’s inhabitants.