Extreme weather and inflation push food prices up

By Crystal Price - bio | email

LAKE CHARLES, LA (KPLC) - Extreme weather conditions and the declining value of the dollar could affect the price consumers pay for groceries by the end of 2011.

The price for all commodities has risen significantly since July 2010. The price of corn skyrocketed the most going from $3.50 to $7.00 a bushel within a six month time period.

Two leading factors for the rising cost of commodities include inflation and extreme cold and wet weather conditions that cut crop production and led to a shortfall in grain surplus.

"We have seen some bad weather around the world," said Michael Kurth, a McNeese professor of economics. "This unusual weather has caused a hazardous effect on the supply of food."

The shortfall in grain surplus is causing different countries who rely heavily on food imports to begin buying food in bulks.

"These governments are busy buying these surplus stocks because they are afraid that they might not have it," said Kurth.

Another factor impacting the price of corn is the amount of corn the United States uses to produce ethanol.

"In the past we've exported corn to feed the world, then possibly we're taking food and burning it up in our cars while people are starving around the world," said Kurth.

Kurth added that all these factors could contribute to a rising cost in food prices throughout the year 2011.

For a look at the current price of commodities, click on the "Market Data" link to the right.

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