DENVER (CBS4) – The U.S. Department for Agriculture has warned that is a high probability of food price increase due to a severe drought in the Midwest.
It’s being called the worst drought in over 50 years, which means food prices will be impacted. It has been stated that the price of milk, eggs and meat would increase above the normal rate of inflation.
Some experts say that prices may increase by between 3 percent and 4 percent next year. However, according to the government’s forecast, prices will rise up to between 4 and 5 percent for beef in 2013.
Richard Volpe, the economist of the U.S. Department for Agriculture, says, “The drought is really going to hit food prices next year.”
Volpe also stated that we could expect the price increase event this year.
“It’s already affecting corn and soybean prices, but then it has to work its way all the way through the system into feed prices and then animal prices, then wholesale prices and then, finally, retail prices,” Volpe said.
The situation is really catastrophic, according to Volpe.