The Price Of Corn Hits A Record High As A Global Food Crisis Looms

Imagine that. Growing food and using it instead as fuel leads to food shortages. And it's subsidized, so consumers have less resources with which to purchase food goods after undue, unnecessary taxation. Hello Dust Bowl, haven't seen you in a while...

Michael Snyder, Contributor
Activist Post

Are you ready for the next major global food crisis? The price of corn hit an all-time record high on Thursday. So did the price of soybeans. The price of corn is up about 50 percent since the middle of last month, and the price of wheat has risen by about 50 percent over the past five weeks. On Thursday, corn for September delivery reached $8.166 per bushel, and many analysts believe that it could hit $10 a bushel before this crisis is over.

The worst drought in the United States in more than 50 years is projected to continue well into August, and more than 1,300 counties in the United States have been declared to be official natural disaster areas.

So how is this crisis going to affect the average person on the street? Well, most Americans and most Europeans are going to notice their grocery bills go up significantly over the coming months. That will not be pleasant. But in other areas of the world this crisis could mean the difference between life and death for some people. You see, half of all global corn exports come from the United States. 

So what happens if the U.S. does not have any corn to export? About a billion people around the world live on the edge of starvation, and today the Financial Times ran a front page story with the following headline: "World braced for new food crisis". Millions upon millions of families in poor countries are barely able to feed themselves right now. So what happens if the price of the food that they buy goes up dramatically?

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About 30 percent of the soybean crop was in poor-to-very-poor condition, which compared with 10 percent a year ago.

Conditions for both crops are expected to worsen in Monday's agriculture agency report.

More than half of the country is experiencing drought conditions right now, and this is devastating both ranchers and farmers. Right now, ranchers all over the western United States are slaughtering their herds early as feed prices rise. It is being projected that the price of meat will rise substantially later this year.

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If prices rose that fast last year, what will those statistics look like at the end of this year if this drought continues?

Sadly, America is not alone. According to Bloomberg, the U.S. is not the only place that is having problems with crops right now….

Dry weather in the U.S., as well as the Black Sea region; a poor start to the Indian monsoon and the possibility of emerging El Nino conditions suggest agricultural products may rally, Barclays said in a report e-mailed yesterday.

And all of this is very bad news for a world that is really struggling to feed itself.

In many countries around the globe, the poor spend up to 75 percent of their incomes on food. Just a 10 percent increase in the price of basic food staples can be absolutely devastating for impoverished families that are living right on the edge.

You may not have ever known what it is like to wonder where your next meal is going to come from, but in many areas around the world that is a daily reality for many families.

The United Nations estimates that 267,000 Yemeni children are facing life-threatening levels of malnutrition. In the Middle East's poorest country hunger has doubled since 2009. More than 10 million people — 44% of the population — do not have enough food to eat, according to the United Nation's World Food Program.

In the United States, we aren't going to see starvation even if nearly the entire corn crop fails. Our grocery bills might be more painful, but there is still going to be plenty of food for everyone.

In other areas of the world, a bad year for global crops can mean the difference between life and death.

The 1,450 mile long Colorado River is probably the most important body of water in the southwestern United States.

Unfortunately, the Colorado River is rapidly dying.

People need to wake up because we have some very serious water issues in this country.

In the heartland of America, farmers pump water from a massive underground lake known as the Ogallala Aquifer to irrigate their fields.

The problem is that the Ogallala Aquifer is rapidly being pumped dry.

According to the U.S. Geological Survey, "a volume equivalent to two-thirds of the water in Lake Erie" has been permanently drained from the Ogallala Aquifer since 1940.

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