Corn and cotton. Soybeans and sugar. The higher price of food commodities has gotten a lot of attention lately. From consumers blanching at the rising cost of vegetables to food maker profits getting squeezed by more expensive ingredients, the spring planting season can’t come soon enough.
The U.S. Department of Agriculture may seem like a sleepy little government agency to urbanites, but the impact of its tabulation of what American farmers will be doing this spring could show up on your grocery bill. Next week, the USDA will update estimates on how many acres of corn, soybeans, cotton and other crops farmers will plant this year.
Iowa corn turns into cattle feed. That feed creates the beef that may wind up at your Memorial Day BBQ. Or that corn may sweeten your summertime ice cream. Texas cotton could be in your beach towel. Oil from an Illinois soybean may be in your Fourth of July sunscreen lotion.
Crop prices have been on a tear lately. They have been driven higher by lower supplies, growing global demand and bad weather. Corn prices have been making a run toward their 2008 highs. Sugar is at its highest price in a generation.
Cotton prices are at post-war highs. (That’s the Civil War.)
Modern agriculture may have computer mapping, GPS tracking and hybrid seeds, but it still adheres to the law of supply and demand. American farmers likely will plant more acres, hoping to cash in on high prices. Consumers can hope those prices don’t force their bank accounts to go on a diet.