On average, food prices typically rise 1% overall for every 50% jump in corn prices, said Richard Volpe, an economist for the Economic Research Service of the U.S. Department of Agriculture, but particular categories of food are impacted more severely.
Analysts and economists predict that prices of beef, pork and poultry will jump the most, as corn is the main feedstock for chicken, cattle and pigs.
Prior to the drought, analysts had predicted a 4% to 6% rise in retail beef prices, said Michael Miller, senior vice president of global research for the National Cattlemen's Beef Association.
But if the drought lingers and the high cost of corn continues to weigh on farmers, consumers could face an increase as high as 10% for fresh protein at the grocery store, said Miller. That means beef prices could jump from an average of $4.35 per pound in 2011 to an average of nearly $4.80 per pound this year.
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