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Agricultural Economists Say Drought Could Impact Food Prices

Drought conditions continue to plague farms across the state.  Purdue economists say if conditions don’t improve, Hoosiers will start to take a hit financially, in the prices they pay at the supermarket.

Indiana corn production is down 20 percent so far this year; soybeans declined 15 percent.  Purdue agricultural economist Chris Hurt says there’s no telling when the drought will end, so  it’s tough to know how serious the losses will be. But he says, there’s already been an impact on food costs.

“I think it’s safe to say every American is going to feel some of this effect.  We’re not talking about huge increases in food prices because of this drought but we are talking about measurable increases.”

Purdue ag economist Corinne Alexander says food prices were also up last year, and there was hope that a good crop this year would help drive down prices in 2013.

“Where we are right now is we’re in a holding pattern where we’re expecting next year food price inflation to continue at above normal levels, maybe on the order of two and a half to three and a half percent.”

Alexander says normal price growth is between two and two and a half percent.  And if continuing weather conditions fail to provide any relief, food price inflation will have gone up at least six percent over the last two years.

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