From USA Today: Smaller-than-expected corn harvests are likely to keep corn prices elevated into next year, driving up retail food prices. That could further dampen consumer spending in an economy hobbled by high unemployment and modest wage increases, USA Today reported. Corn is used in everything from animal feed to cereal.
U.S. corn prices have surged about 70% since August 2010 to more than $7 a bushel. This year, a big corn harvest was expected to push down corn prices and moderate retail food bills. But spring floods and summer heat in the Midwest and drought in Texas and Oklahoma killed crops and cut yields.
The U.S. Department of Agriculture has cut its forecast for the fall harvest from a record 13.5 billion bushels to 12.9 billion, which would still be the third-largest corn crop ever.
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