Friday, December 15, 2017
News Roundup

Drought will increase food prices in 2013, USDA says

MINNEAPOLIS

The drought gripping more than half the country is a major reason why consumers can expect to pay 3 percent to 4 percent more for groceries next year, the U.S. Department of Agriculture said Wednesday.

Milk, eggs, beef, poultry and pork prices will all be affected because the drought has pushed up prices for feed, and that will eventually translate into higher prices for steaks, hamburger, pork chops and chicken. The good news for cost-conscious consumers is that prices for fruits and vegetables, as well as processed foods, aren't affected as much by the drought.

Exactly how much more people might pay for a pound of hamburger, for example, isn't known because those prices are affected by lots of factors, including how much of the increase a given supermarket might pass along to the consumer. But beef prices as a whole are expected to see the biggest jump at 4 percent to 5 percent, according to the USDA.

"In 2013 as a result of this drought we are looking at above-normal food price inflation. … Consumers are certainly going to feel it," USDA economist Richard Volpe said.

Normal grocery price inflation is about 2.8 percent a year, Volpe said, so even a 3 percent increase is slightly higher than usual. The USDA kept its projected food price increase for 2012 steady at 2.5 percent to 3.5 percent, saying average retail food prices were flat for the first half of 2012, thanks to unusually low fruit and vegetable prices as well as lower prices for milk and pork.

The new forecasts are the agency's first food price projections to factor in the drought, though experts have been warning for a few weeks that prices will rise. As fields dry out and crops wither across much of the country's midsection, prices for corn, soybeans and other commodities have soared in anticipation of tight supplies. That means farmers and ranchers will have to pay more to feed their livestock, and those costs eventually get passed on to consumers. Food prices typically climb about 1 percent for every 50 percent increase in average corn prices, according to agricultural economists.

The drought now covers about 60 percent of the continental United States, the largest area since the epic droughts of the 1930s and 1950s.

"It's a disaster," said Rick Tolman, CEO of the National Corn Growers Association, who noted that farmers started out the season anticipating a record 14 billion bushel corn crop. The drought is expected to cut production by roughly 3 billion bushels. "We would have had adequate supplies, prices would have gone down. Instead, we have the drought," he said.

Poultry prices will be the first to rise because chickens and turkeys need only a few months to grow to market size, Volpe said. Beef and pork take longer, and the agency actually revised its beef price projection for 2012 downward because producers are sending more cattle to the market as they reduce their herds in response to the drought, he said.

Meat and poultry prices will be more affected than processed food prices because feed prices represent the biggest part of their cost of production. Processed food prices are less affected because corn and other ingredients typically make up just a fraction of their production costs compared with expenses such as transportation and marketing.

The drought is creating multiple problems for dairy farmers that consumers will eventually feel, said Ed Jesse, an emeritus professor of agricultural economics at the University of Wisconsin in Madison.

Farmers have begun culling their herds, which will mean less milk down the line. Also, cows give less milk in the heat, and the milk they do produce is lower in proteins and butterfat, Jesse said. That means cheese and butter prices are going up because it takes more milk to produce the same amount.

Jesse predicted that milk prices for consumers will rise by 10 percent or more.

Comments
Lightning routs Coyotes for sixth straight win

Lightning routs Coyotes for sixth straight win

GLENDALE, Ariz. — As much as the Lightning has been rolling, it remembered how it lost twice last season to the Coyotes.That included blowing a one-goal third-period lead at home down the stretch, with Tampa Bay missing the playoffs by a point."You l...
Updated: 2 hours ago
Stephan Jiggetts’ 20 points lead USF basketball over Bethune-Cookman

Stephan Jiggetts’ 20 points lead USF basketball over Bethune-Cookman

TAMPA — USF used a 21-3 run midway through the second half en route to an 83-63 win over Bethune-Cookman on Thursday night before an announced 2,091 at the Sun Dome.The victory halted a four-game losing streak for the Bulls (5-6), who scored the last...
Updated: 4 hours ago

High school scoreboard for Dec. 14

Thursday’s scoreboardGirls soccerLargo 4, Boca Ciega 1
Updated: 4 hours ago
House Speaker Paul Ryan says he’s not leaving Congress soon

House Speaker Paul Ryan says he’s not leaving Congress soon

WASHINGTON — House Speaker Paul Ryan said Thursday he’s not leaving Congress anytime soon, trying to squelch rumors that he will walk away in triumph after the Republicans’ treasured tax bill is approved. Politico and the Huffington Post published re...
Updated: 5 hours ago
No big deal for Rays at winter meetings, but it’s still coming

No big deal for Rays at winter meetings, but it’s still coming

LAKE BUENA VISTA — Here’s the one thing we definitely know:Rays officials headed home from the winter meetings and back across I-4 Thursday without making deals to trade any of their bigger-name, higher-paid players. Not closer Alex Colome, not third...
Updated: 5 hours ago
Tampa police seek ‘person of interest’ in Dec. 3 homicide

Tampa police seek ‘person of interest’ in Dec. 3 homicide

TAMPA — Police are seeking a "person of interest" who they believe has information about a Dec. 3 drive-by shooting that killed a 22-year-old man.Police are searching for Anan Motilal, 25. He stands about 5-foot-10 and weighs 180 pounds. He may have ...
Updated: 5 hours ago

Lottery resultsNumbers drawn after 9 p.m. are no longer available by our deadlines. For results, please go to tampabay.com/lottery.Pick 2, 3, 4, 5Thurs., Dec. 14, midday:97 796 8399e_SRit63724Thurs., Dec. 14, evening:37 731 1382e_SRit63276LottoWed., ...
Updated: 5 hours ago
Pence to delay Mideast trip as tax deal nears vote

Pence to delay Mideast trip as tax deal nears vote

WASHINGTON — Vice President Mike Pence is delaying his weekend departure for the Middle East as Congress nears completion of a tax overhaul, his office announced Thursday. White House officials said Pence now plans to leave for Egypt on Tuesday so he...
Updated: 5 hours ago

Pinellas Park officer stuns middle school student with Taser

PINELLAS PARK — A school resource officer stunned a middle school student with a Taser while trying to break up a fight between her and another female student on Thursday, police said.Neither the Pinellas Park officer nor the students involved in the...
Updated: 5 hours ago
Senator: Comey’s remarks on Clinton probe heavily edited

Senator: Comey’s remarks on Clinton probe heavily edited

WASHINGTON — A draft statement former FBI director James Comey prepared in anticipation of concluding the Hillary Clinton email case without criminal charges was heavily edited to change the "tone and substance" of the remarks, a Republican senator s...
Updated: 5 hours ago