Formazor

Drought in America Has Domino Effect

As of mid-August 2012, the summer drought has covered over 60 percent of the contiguous 48 states.

Why does this matter?

Droughts can have serious health, social, economic and political impacts with far-reaching consequences. Water is one of the most essential commodities for human survival, and when there isn’t enough water to support food crops, well….that spells Trouble.

When a drought undermines food sources, it is a question of Supply vs. Demand. There is less food to go around and higher prices are passed along to the consumer. A drought directly affects grass and grain used to feed livestock and poultry. Currently, 59 percent of pastures and rangelands are in poor or very poor condition; 51 % of corn crops are reported to be in poor or very poor condition across the 18 primary corn-producing states. The availability, and price, of DDGs, a co-product of ethanol production widely-used in swine diets, is severely affected as reported by Pork Network: (http://www.porknetwork.com/pork-news/Ethanol-plant-closures-cause-DDGS-supply-issues-166035306.html)

Likewise, the table egg market has been negatively impacted. The price of large shell eggs hit an all-time high the week of July 30th.

Additionally, Food Navigator.com reported: “USDA Predicts Strong Food Price Inflation as Drought Continues.” The commodity market of eggs and milk (including fresh, dried and milk by-products) has escalated by double digits in a very short time. As a result the bowl cost for the commercial baker will see a substantial increase. http://www.foodnavigator-usa.com/Markets/USDA-predicts-strong-food-price-inflation-as-drought-continues

If you are sourcing alternative ingredients, please call Fornazor International. We offer a variety of egg replacers and milk replacers to help keep costs down or minimize the increases.