The Economic Impact of Midwest Flooding

@newtondak (3949)
United States
June 16, 2008 10:46am CST
Undoubtedly, you've all been seeing the photos on the news of the flooding in Iowa. This week, you will be seeing much of the same in Missouri as these waters flow down into the Mississippi River. Thousands upon thousands of acres of cropland are under water, and those that aren't under water have been too wet all spring for crops to be planted. Corn, wheat and soybean production has been affected greatly and December corn futures are now well above $7 a bushel. I think we can expect to see even greater increases in food prices as a result of not only the flooding in the Midwest, but also the drought conditions in other areas of our country.
1 person likes this
2 responses
@ZephyrSun (7382)
• United States
16 Jun 08
$7 a bushel? Oh my I can't believe how much it went up. My husband's one customer a few months ago he was waiting for it to hit $5 to sell his crop from last year. I have already see the increase in cooking oil. I was asking my husband about this yesterday because it was on sale for $4.50 a quart (which I thought was high). He explained that the same part of the plant is used for bio-fuel therefore increasing the price of everything that has a connection to the "new" fuel. I do not think that it will only increase the price of foods, I think there will be much more items increased due to the flooding as well as the droughts.
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@newtondak (3949)
• United States
16 Jun 08
I also noticed the price of cooking oil being way up the last time I was at the store. I never bought the more expensive types of oil - olive, canola, etc. - but now that corn and vegetable oil prices have reached the same level, I just as well buy the healthier stuff! We have been able to buy fuel that is part ethanol for less, but with the corn crop failures, I am sure that there will be a shortage not only for human consumption, but also for ethanol production. Undoubtedly, this will push up the price of that fuel as well. We live and work on a cattle ranch, and use corn gluten - a byproduct of ethanol production - as part of the feed for the cattle. In many other areas, livestock producers use byproducts of wheat, peanuts, soybeans, and even sugar beets as feed sources. In doing this instead of feeding whole grains, we are reducing our cost to produce the animal as well as making less of an impact on the supplies of grain needed for human consumption. In addition to the crops in the field that have been destroyed or have not even been planted at this time, some grain storage facilities have also been flooded which may destroy some of last year's crop still in storage. I think for those who haven't already, it's probably a good time to start tightening your belt where your finances are concerned as I don't think the price of anything is going to be going down!
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@ZephyrSun (7382)
• United States
16 Jun 08
We have done the belt tightening since the price of gas hit $3 a gallon and we both drive SUV's. I don't see any relief for Americans coming any time soon and I keep telling my husband (who always sees the positive in everything) that we are heading straight to a depression and he laughs at me. I have started stocking up on items when on sale and I have coupons and he laughs so much. We could go eight months with out buying anything other than meat. I am planning on emailing this dicussion to him to see that I am not the only one that believes product costs are on the raise. LOL
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@ZephyrSun (7382)
• United States
28 Jun 08
Thanks for the best response
@bmorehouse1 (1028)
• United States
11 Jul 08
The flooding defintitely will have an economic impact. Not only crops, but there were many businesses as well as homes lost to the flooding. I would hazard a guess that to open these businesses back up all their prices will have to go up to compensate for what they have lost. If they did not have flood insurance then, they are really in a hurt. Of course there is FEMA, but they really won't get that much for their losses. The flooding has an impact in many different ways.